CEWRL to develop rail infrastructure for coal evacuation in Chhattisgarh at a cost of Rs 4,970 cr

New Delhi: Chhattisgarh East-West Railway Limited (CEWRL), a subsidiary company of SECL formed in a joint venture with IRCON and government of Chhattisgarh, has signed an agreement with a consortium of banks led by State Bank of India (SBI) for a loan of Rs 3,976 crore for development of a 135-KM double rail line to help evacuate coal from SECL mines. CEWRL project is planned with the specific purpose of augmenting the rail infrastructure in the state of Chhattisgarh. This project is being implemented based on the Joint Venture (JV) model of PPP projects under Concession Agreement (CA) with the Ministry of Railways and is notified as a 'Special Railway Project' to provide a national infrastructure for public purpose with high priority accorded by the government.

With an emphasis on using more environment-friendly modes of transportation, the Chhattisgarh East-West Rail corridor project, having an approximate length of 135.30 km of mainline (New BG Electrified Double Rail Line) and 56 km of connectivity lines, will be instrumental in reducing the burden on the single evacuation rail link in the region which extends from Gevra Road station to Champa where it joins the main Kolkata-Mumbai trunk line. The East-West corridor will provide a shorter route for coal transportation by joining Gevra Road to the Bilaspur-Annupur-Katni line at the Pendra Road station and thus will enable seamless movement of coal from SECL's mines as well as other coal mines in the Mand-Raigarh and Korba coalfields of Chhattisgarh to northern and western parts of India.

The project is planned to have connectivity lines to the Gevra, Kusmunda and Dipika Mines of SECL which have a high potential for coal production. The East-West corridor will mainly comprise of coal traffic from Korba Mines and Mand Raigarh coalfields of SECL and is strategically located for specifically serving the purpose of coal transportation from these coalfields.

CEWRL project cost is estimated to be Rs 4,970 crore with a funding structure of Debt:Equity of 80:20 i.e Rs 3,976 crore of debt and Rs 994 crore of equity. Demonstrating the commitment towards the project, promoters have already invested Rs 650.00 cores in the CEWRL project. Using this money, the company has been able to acquire the desired land and get forest clearance for the mainline. The project is expected to be completed by March 2023.

For the total exposure of debt of Rs 3,976 crore, the company has signed the Rupee Term Loan documents with the consortium of banks for part financing of the project. The consortium is led by SBI with other participating banks being Bank of Baroda, Canara Bank, Punjab National Bank, Union Bank of India and Indian Bank.
For completing the loan documentation, the final loan document i.e, sponsor support agreement has been signed between the promoters, viz South Eastern Coalfields Limited (SECL), Ircon International Limited (IRCON) and Government of Chhattisgarh, the JV Company, the lender's agent and security trustee on July 22 at Raipur. This concludes the documentation process of achieving financial closure of the project.

This will facilitate early disbursement from banks and upon undertaking the construction activity at large by the JV company, will, in turn, help in boosting up the economy at large.

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