Bhopal, Aug 4 - A Karnataka-based company will set up a bio-gas plant in Madhya Pradesh to produce power from 'bhusa' (wheat chaff) and corn stems.

ASN Industries will set up the 7.5 MW bio-gas plant at Katni district at an investment of Rs.30 crore, government officials said.

The plant is coming up on 12 acres in the district's Gudar village and will create at least 160 job opportunities.

They added that the Madhya Pradesh Electricity Board has already entered into an agreement with ASN Industries to buy power from the Gudar plant.

The plant is expected to consume 180-200 tonnes of biomass and 30 tonnes of coal daily.

There is no need to worry about pollution, said an official

About 47.52 tonnes of residual ash that the plant would be producing daily would be used in brick kilns and cement factories, he added.