Web Exclusive | January 2018
Essar to surrender Tokisud coal mine, seek Rs 4.9-bn refund
Essar Power has decided to surrender the Tokisud North coal block in Jharkhand. The company has already invested Rs 490 crore in the project. The move which comes in the backdrop of facing delays in key approvals and sudden change in tariff terms, will cripple the company's 1,200-MW Mahan plant in Madhya Pradesh. The Ruias-run company has made progress in developing the coal block, which has extractable reserves of 52 million tonnes, and won through a competitive bidding process in February 2015 offering Rs 1,100 a tonne, the highest in the industry. Surrendering the coal block will hit its 1,200-MW, Rs 8,000 crore Mahan Power Plant, which had been shut between September 2014 and May 2016 after the Supreme Court had cancelled all the 204 coal blocks allotted by the previous Manmohan Singh government citing corruption. "We've written to the coal ministry expressing our interest to surrender the Tokisud North Coal Mines in which we have already invested Rs 490 crore. The block needs over Rs 600 crore more investment," Essar Power Group vice-chairman Pradeep Mittal said.