Reliance Challenges Centre’s Decision to Cancel Chhatrasal Coal Block

Reliance Power moves to court against coal ministry’s move to take away Chhatrasal coal block from its subsidiary, Sasan, a 4,000 MW Ultra Mega Power Project (UMPP).

On Thursday, Reliance Power pleaded against government’s notification dated 7 May’15 to cancel Chhatrasal coal block allotted to Sasan (UMPP) in Delhi high court. The ministry had canceled allocation of the blocks referring to the verdict of SC in Aug’14.

Three coal blocks, namely, Moher, Moher-Amlori and Chhatrasal were allotted to Reliance Power to fulfill the fuel needs of Sasan UMPP. The power project requires about 16 MnT coal annually. However, the company was extractingt 9 MnT more coal to fuel its other projects, being permitted by the ministry in 2008.

Reliance Power filed a petition on the grounds that the coal obtained from Chhatrasal and other two coal blocks was the main reason for its bidding for power plants. It also mentioned that because of these three blocks allocated to Sasan (UMPP), the company had agreed to offer power supply from the power project at competitive tariff of INR 1.19 per unit.

Blocks Allotted to Sasan UMPP

Qty in MnT
Source- SteelMint Research

It should also be noted that in June’15, centre instructed Reliance Power to curb its coal production from Moher and Moher Amlohri Extn from 20 MnT to 16 MnT.