The NTPC and Nalco managements have decided to cancel the proposed 2,400-MW Gajamara power project located in Dhenkanal district of Odisha. The project was supposed to provide power to Nalco’s smelter plant, which is located 60 km away at Angul district.

Nalco is planning a brownfield expansion at its aluminium smelter plant at Angul, with an additional capacity of 5 lakh tonnes a year at an estimated capex of ₹10,000 crore.

Farmers’ demand

A senior NTPC official told BusinessLine on condition of anonymity that the NPTC management had transferred over ₹100 crore to the Odisha government for land acquisition. The money has been transferred to the land owners but they continue to demand higher compensation. Some land owners have even approached the courts, seeking higher value for their land parcels. In effect, the money has gone to the land owners but NTPC is not in possession of the land, the official said.

In December 2016, both the PSUs had entered into a MoU, for developing power projects and other business collaborations in India. Under the MoU, the companies were to float a joint venture namely NTPC-Nalco Power Company (NNPC) to set up power plants. But that agreement now stands cancelled.

NNPC’s first such power plant was planned at Gajamara. The super critical power plant project was to cost ₹14,000 crore, with three units of 800 MW. The plant was to provide uninterrupted power to Nalco’s Angul smelter. But the power project has run into coal linkage issues and land acquisition troubles.

Costs written off

The official said that in the process for acquisition of 1,600 acres of land in Gajamara was met with opposition from the local farmers, which today has resulted in NTPC management writing off ₹100-crore costs.

BusinessLine had sent emails to NTPC and Nalco managements seeking their views, but no reply was received.