Cabinet likely to discuss Karanpura plant issue

The high-powered Cabinet Committee on Investment (CCI) is likely to discuss the vexed issue of location of the North Karanpura Thermal Power Project in Jharkhand at its second meeting, on Wednesday.

The Rs 10,000-crore project has been stuck since 1993 because of disagreement between the power and coal ministries over six billion tonnes of high-grade coal reserves.

According to officials in the know, CCI will discuss coal projects with a production potential of 37 million tonnes in which Rs 1,347 crore worth of investments have been stuck.

The coal and environment ministries have identified 12 projects held up for want of environment clearances and where approvals can be expedited.

Officials said the dispute over the location of North Karanpura project erupted in 2003 when the coal ministry — 15 years after the project site was first discussed — said the site at Chatra district was located over an unbelievable six-billion tonne (bt) of high quality coal reserves. For comparison, this is roughly a tenth of the 62 bt coal reserves held by the world’s largest coal miner, Coal India.

The ministry objected to setting up the project, arguing the proposed 1,980-Mw power plant would sterilise the huge coal reserves. The proposal was to build the power plant, a water reservoir to meet the water needs of the plant by creating a dam, other infrastructure facilities, and a township. The coal ministry fears construction of the dam will restrict the operation of Amrapali and other coal blocks around the area.

Also, the water reservoir will be a potential threat for inundation by flash floods in nearby Piparwar and Magadh mines of CIL — which are expected to yield 40 million tonnes of coal every year — as the catchment will be at a higher elevation than the mines. Plus, the heavy blasting in nearby mines could destabilise the dam. The dam would also submerge 16 sqkm area, a bulk of which is forest land, apart from engulfing seven villages, according to the coal ministry.

CCI met last month for its first meeting, but could not deliver much. While the agenda was to clear hurdles for $13.5 billion worth of investment in 47 stalled oil exploration projects, it ended with a directive to the oil and defence ministries to sort out differences over 39 of those blocks within a month.

CCI was set up to expedite clearance for stuck up projects costing over Rs 1,000 crore.