May 17, 2008

Chhattisgarh denies signing water supply pact with NTPC Seepat

Chhattisgarh government has last week denied that it has ever signed any pact with National Thermal Power Corporation to draw water from the state’s resources for its 2,980 MW Sipat power project in Bilaspur district.

Mr Hemchand Yadav water resources minister of Chhattisgarh asked "Which agreement? Neither the undivided Madhya Pradesh nor the Chhattisgarh government had ever signed any agreement with NTPC to provide water from the state’s resources to the Sipat plant."

He added that water was supplied to the plant earlier following some understanding and not any agreement.

NTPC management has been stating that the Chhattisgarh government reneged on its commitment to supply water and this had put on hold the commissioning of the first 500 MW unit of INR 12,000 crore Sipat power project. After the trial run for 14 days, the unit had to be closed due to shortage of water. The second 500 MW unit would have been commissioned in March 2008 or early April but that plan is also put on hold.

NTPC has been passing through the worst ever crisis in Chhattisgarh with two of its major projects at stake. Besides the Sipat plant, the construction of 500 MW expansion unit in the 2,100 MW Korba plant has also run into rough weather after the state government curtailed the quantity of water supplied to the plant.