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Power major NTPC has scrapped a Rs.23,000-crore order with Thiess Minecs India Pvt. Ltd because of delay in the development and operation of the Pakri-Barwadih captive coal block in North Karanpura coalfields in Hazaribagh district of Jharkhand.

“TM failed to make any headway despite the fact that (the) development period of the contract was extended twice i.e. initially for 450 days and 360 days later. In toto, an opportunity of 1,170 days was given for development phase. The above failure of TM was brought to the notice of Mr. Bruce Munro, MD, Thiess Pty. Ltd, Australia, through emails on many occasions and got no response. NTPC, in this regard, issued a show-cause notice to TM on 10th July, 2012, stating the defaults and non-fulfillment of contractual obligations by TM without any response,” NTPC said in a news release.

NTPC said that it had no option but to terminate the contract on May 7, 2014, with a notice period of 45 days.

Following global tendering, the company was appointed as mine developer-cum-operator of Pakri-Barwadih captive coal block on November 30, 2010, for a period of 27 years at an estimated contract value of Rs.23,000 crore. The order consisted of development period of 360 days (which ended on November 25, 2011) and balance for operation stage.

NTPC brought the issue to the notice of the visiting Australian minister for mining. In spite of persistent reviews by India’s Ministry of Coal and Ministry of Power, which were made known to TM from time to time, there was “no improvement at field level,” NTPC said.

Thiess Minecs India Pvt. Ltd was established in 2006 to provide world-class mining and construction services to the Indian mining industry. It is a 100 per cent subsidiary of Thiess Pty Ltd, Australia, which is a leading mining, construction and services contractor with diverse operations throughout Australia and selected international markets.

TM was awarded the contract to develop, construct and operate a 15-million tpa coal mining project at Pakri-Barwadih, allotted to NTPC Ltd for captive mining and supply of coal for its super thermal power stations. The Ministry of Environment and Forests has granted environment clearance to the project. Similarly, the forest department has accorded Stage II clearance. The scope of work in the project involves the construction and/or operation of facilities in addition to operating the mine for its entire life of 25 years.

Meanwhile, NTPC is contesting a bank guarantee of Rs.138.6 crore imposed by the Ministry of Coal for “poor progress of a scarce national asset.” However, NTPC has admitted that other contractors had made good progress in construction of coal handling plants in the same area. Similarly, in North Karanpura area, close to the Pakri-Barwadih project site, works were in progress with the cooperation of villagers. Indian Railways had also nearly completed the rail link.

The power utility also informed that work at its second mine, Chatti Bariatu, also in Jharkhand, was progressing at a fast pace and mining of coal was expected to commence this year.

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