Jharkhand says Reliance Power's Tilaiya exit 'surprising'

Terming Reliance Power's decision to exit from the proposed Tilaiya power project as 'surprising', Jharkhand government today put the blame on the company and said the reasons cited for the walkout were 'doubtful' as all major issues had already been resolved.
Reliance Power, part of Anil Ambani-led Group, yesterday terminated the agreement for the 3,960 megawatt Ultra Mega Power Project (UMPP), citing delays in land acquisition and issues related captive coal blocks and infrastructure.
"Reliance's decision to exit is surprising and doubtful," Jharkhand Chief Secretary Rajiv Gauba said here, while indicating that the real reason could be something else as the company recently sought tariff review citing cost escalation to the tune of Rs 16,000 crore for the project.

"Had they (Reliance Power) taken the decision six months ago, we could have understood. (But) Taking it now is surprising as important issues have been resolved and many issues are in advanced stage (of getting resolved)," he added.
"The reason cited by the company is doubtful as they had sought extension for submitting land acquisition from April 15 to May 5, 2015," Gauba said.
"Land and forest issues are not correct and (may be) just an excuse," he said, while indicating that the project cost could be the reason for the exit.

Gauba said Reliance Power had sought tariff review despite making an aggressive bidding while quoting the lowest of 1.77 paise per unit for the project.

Asked whether the Reliance Power's decision could be a pressure tactic, Gauba refused to speculate but said that the state would not come under any pressure.
He also referred to a meeting held on April 17 between Jharkhand energy secretary and a senior executive of Reliance Power, saying that the tariff revision was the only issue that was taken up during that meeting.
Gauba said the Reliance Power executive had told the energy secretary that there should be a tariff review as the project cost had escalated by Rs 16,000 crore making it financially unviable.
Gauba further said Reliance Power had not taken any construction or environmental clearance and did not attend a public hearing slated in March.

Instead, the company sought another date, which indicated that the company was 'not so keen' on the project, he added.
"We have been monitoring the project (Tilaiya) and the things that were required are being expedited by different departments on important issues like diversion of forest land.
"I can say with confidence that there has been a significant improvement in these areas. Even the union surface transport minister acknowledged that there is a remarkable improvement," he said.
The Chief Secretary also cited statements from officials of NHAI, Union Coal Secretary, Eastern Coalfields and Central Coalfields to claim that bulk of issues have been resolved.

The state government officials had also met Union Coal Secretary and there were no issues left to address accept the Jharia (underground fire) issue which is a different one.
"Railway projects in the state have been reviewed and necessary directions were issued," he said.
Stating that regular video conferencing was being held with deputy commissioners, Gauba said the state has been assuring investors that all possible steps in key infrastructure areas were being taken to facilitate the flow of investment, that would give boost to infrastructure and maximise employment opportunities.
To a query on the project's fate, he said the next step would be decided in consultation with the Union Power Ministry.