2 Sugar Mills to Set Up 53MW Bagasse Power Plants

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1 year 11 months ago #15837 by farheen
farheen created the topic: 2 Sugar Mills to Set Up 53MW Bagasse Power Plants
The country's two sugar mills are going to invest over Rs 1.4 billion to develop two bagasse-based power plants of 53 megawatts capacity. Also, one of the two sugar millers has decided to invest Rs 125 million to incorporate a confectionary firm as part of its diversification plan.

Mehran Sugar Mills Limited (MSML) and Faran Sugar Mill Limited (FSML) are developing 26.5MW separately at a cost of Rs 750 million and Rs 650 million. MSML, according to Company Secretary Muhammad Hanif Aziz, decided to set up the power generation plant "in view of the rising demand for electricity in the country and government's favourable policy for promoting bagasse-based power projects."

Bagasse is a dry pulpy residue left after the extraction of juice from sugarcane. Subject to shareholders' nod, the project would be 100 percent owned by Mehran Sugar. "The company has, in principal, decided to invest equity up to Rs 750 million in the power project," he said in a stock filing. The millers have set December 2018 as a deadline for operationality of the proposed power plant. Besides, MSML would be setting up a separate firm at Rs 125 million to diversify its business from sugar. The company would be involved in the manufacturing and branding of confectionary/backing products, he said.

"Mehran Sugar plans to acquire 24 percent equity of the new company," the official said.

Likewise, Board of Directors of FSML, another sugar maker, also has principally agreed to invest Rs 650 million for establishing 26.5MW bagasse-fired power plant. The HP cogeneration power project, according to company secretary Muhammad Ayub, would be built through a wholly-owned subsidiary. "Due diligence is under process," said the company official in a stock filing.


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