Jharkhand power plant stuck in coal joint venture dispute

Jharkhand, which is reeling under a power shortage of 5,000mw, has not moved on any big power project after the nod to 4,000mw ultra mega power project at Tilaiya.

The 1,980mw Patratu Thermal Power Project, conceived by the Jharkhand State Electricity Board (JSEB) two years ago, has been languishing on paper since the board held its first pre-bid meeting in October 27 last year, where almost all big private players had participated.

On April 25, 2010, JSEB issued global tenders inviting expression of interest from power players to develop a thermal power plant at Patratu with a capacity of 1,320-1,980mw.

Patratu has one of the country’s oldest power plants with 840mw capacity, currently running at unbelievably low plant load factor.

Under the plan, the new plant was to be linked with the 400 million tonne Banhardih coal block. This block was to be developed by a joint venture company to be formed between the successful bidder of the project and JSEB.

While the pre-bid conference saw a huge response from almost all private power players including companies, the power plant plan has not moved since then.

Sources say JSEB was planning to invite request for qualification (RFQ) documents in January which was to be followed by invitation for request for proposal (RFP) in two months, but there has been no movement on it.

Both JSEB and the consultants for the project, PFC Consulting, are officially mum on the project and when insisted three senior JSEB officials gave different versions on the current situation.

“Land and water is not a problem for the plant, it is a matter of final approval from the central government and once that is obtained we can go ahead,” said a JSEB official. However, he did not disclose which approvals are awaited.

Another senior official at the state electricity board, said: “PFC was the consultant to us on the project and we had to pay them a substantial amount, which we have deferred so far. As a result, PFC is not keen to take it forward.”

ND Tyagi, CEO, PFC Consulting, who had attended the pre-bid meeting, could not be reached for comments.

“The major reason is that JSEB is in a legal battle with Eastern Minerals and Trading Agency (EMTA), which was its joint venture partner for developing captive coal blocks allotted to JSEB. Unless the air on the state of the JV is cleared, it will be difficult for the state to give away the coal block to a private party for development,” said another senior JSEB official. On March 25, 2003, JSEB and EMTA signed a memorandum of understanding to develop captive coal blocks together in the state. However, the JV did not have a smooth run and soon after ran into a legal tussle with each other.

In fact, there are chances that the power plant may not see light of the day as on May 5, 2011, Union coal minister Shri Prakash Jaiswal had released a list of 15 coal blocks which have not been developed since allocation to different parties. JSEB’s Banhardih coal block is one of them.