Tata Power may pull out of its ambitious Rs 12,000-crore (Rs 120 billion), 3,000 Mw project in Jharkhand. According to company executives, the state government is seeking a new project bid after signing an initial agreement with Tata Power last October.
This is the second time the BJP-ruled state is losing out on big investment. Earlier this year, steel magnate LN Mittal had said Mittal Steel might drop plans for a Rs 25,000 crore (Rs 250 billion), 10 million tonne steel plant in the state.
A senior Tata Power executive said: "We have completed the initial surveys and have made our recommendations to the state government. But the government now wants to call a bid for the power project. If and when they call a bid, we will evaluate it afresh."
Tata Power had, at the time of signing the memorandum of understanding, recommended expansion of an existing power plant in Jharkhand and setting up of several smaller plants across the state, depending on availability of coal.
Tata Power's MoU also called for examining opportunities for captive coal mining, in addition to setting up the 3,000-Mw coal pithead power project.
The company had been considering Ramgarh and Latehar, where captive coal is available. As part of the MoU, the company was also to examine distribution and transmission issues to facilitate the entry of private players.
Tata Power already has an installed capacity of 368 Mw in Jharkhand, including the 129-Mw Jojobera plant. The 1000-Mw Maithon station is expected to go on stream in the next five years.
Other important projects announced in the state include Jindal Steel, which plans to invest Rs 11,000 crore (Rs 110 billion), Essar Steel (Rs 5,000 crore or Rs 50 billion), Hindalco, which has signed an MoU worth Rs 7,800 crore (Rs 78 billion) to set up an aluminium plant in Latehar and Tata Steel, which announced an integrated 12 million tonne greenfield project last year.
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