Tilaiya UMPP: Panel seeks fresh comments from PowerMin, others

NEW DELHI : The inter-ministerial panel formed to look into the issues pertaining to Tilaiya UMPP — relinquished by Reliance Power — has failed to make any headway in the matter relating to the bank guarantee and has sought fresh comments from the power ministry and PFC.
“IMG (Inter-Ministerial Group) thus noted that in absence of any concrete comments/reply from the Ministry of Power, no decision on the matter could be taken. IMG, therefore, recommended seeking fresh specific comments from the Ministry of Power…And place them for further consideration,” an official said.
The Coal Ministry had earlier issued a show-cause notice to Reliance Power, seeking reasons for delays in developing coal mines allocated for Tilaiya UMPP.
The panel was of the view that the comments received from the Ministry of Power and the Jharkhand government did not reveal anything specific so as to facilitate decision making on the issue of release/deduction of bank guarantee (BG), the official said.
The official further said the power ministry had clarified that with regard to development of coal blocks earmarked for UMPPs, it was no way involved and the actual responsibility for the mines development was of the procurers of this project.
The ministry further informed the panel that the procurers had accepted the termination of power purchase agreement (PPA), however, refused to accept the delay in development of coal block on their part.
Joint Secretary in the Power Ministry “reiterated that as per the PPA, it was the responsibility of the procurers to fulfill their obligations, which as per JIPL claim have not been complied with”, the official said.
The IMG met this month to deliberate upon the issue of deduction/release of bank guarantee with regard to coal blocks including Kerandari B&C mine submitted by the allotee company (Reliance Power).
Reliance Power/JIPL (Jharkhand Integrated Power Ltd) was allocated Kerandari B&C coal block for using coal captive in the Tilaiya Ultra Mega Power Project (UMPP), however, Reliance Power has relinquished it.
‘Agree to Terminate’ option was exercised and accepted voluntarily by RPL and the Procurers. This act, though authorised, is extraneous to the course of development of coal block.
The official further said panel was of the view that “the bank guarantee per se was one of the parts of the terms and conditions of the allocation letter dated July 20, 2007 of the said block issued in favour of Power Finance Corporation. As such, the examination of the case should be strictly on the terms and conditions of the said allocation letter.”
The government had earlier said that it has been decided to place the matter of deduction of bank guarantee submitted by Reliance Power for Kerandari B&C coal block before the Inter-Ministerial Group for making recommendations to the government.
In 2007 the Coal Ministry had allocated Kerandari B&C coal block to JIPL, a subsidiary of Power Finance Corporation (PFC), subject to certain conditions.
Further, Reliance Power acquired JIPL from PFC in 2009 after emerging as the lowest bidder in the International Competitive Bidding process for Tilaiya UMPP. Subsequently, RPL communicated that it had terminated the PPA and relinquished Tiliaya UMPP.
Hence, Reliance Power requested the Coal Ministry for release of bank guarantee submitted by it for Kerandari B&C coal block. (AGENCIES)


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