Notice to Reliance Power for Tilaiya coal block delay

NEW DELHI: The coal ministry has issued a show-cause notice to Anil Ambani-led Reliance Power, seeking an explanation on the delay in development of coal blocks attached to the abandoned Tilaiya ultra mega power project (UMPP).

The ministry has asked the company to respond within 15 days and explain why its bank guarantee should not be deducted for violation of the terms of allotment of the Kerandari B&C coal blocks.

"Tilaiya UMPP project has received a huge setback rendering the country deprived of power to be produced from the said project. Hence, Reliance Power/Jharkhand Integrated Power Ltd cannot be absolved of its responsibility of paying damages for non-achievement of milestones set for development of Kerandari B&C coal blocks," the notice issued on Tuesday said.

Reliance Power said the showcause notice has been uploaded on the coal ministry’s site but has not been received by the company. A detailed response to the new show-cause notice will be submitted to the coal ministry in due course, a company statement said.

Procurers are at the final stage of acquiring Jharkhand Integrated Power Ltd – special purpose vehicle for Tilaiya UMPP – from Reliance Power, it said.

The company said the coal ministry had sent a similar notice in December 2013, to which the company had responded in detail. There has been no response from the coal ministry for the past two-and-half years, it said. On Wednesday, shares of Reliance Power closed at Rs51.30 on the Bombay Stock Exchange, down 1.44% from the previous close.