Anil Ambani-led Reliance Power today revealed that it has terminated the contract for Rs 36,000 crore Tilaiya ultra mega power project in Jharkhand because of undue delays in land acquisition.

In August 2009, the Company, after bidding a levelised tariff of Rs 1.77 per unit, had won rights to set up a 3,960 MW power plant at Hazaribagh in Jharkhand. But, the work could not start as the state government did not provide the required land even after more than five years.

Jharkhand Integrated Power Ltd (JIPL), a special purpose vehicle generated for implementing the project, had signed the Power Purchase Agreement (PPA) with 18 power off-takers in 10 states for 25 years. The coal was to be sourced from Kerendari BC coal mine block.

The total land required for the project was over 17,000 acres.

The company said that even after more than 25 review meetings and extensive follow-ups with the state government, the required land is yet to be made available.

With the conclusion of this project, Reliance Power has decreased its future capital expenditure by Rs 36,000 crore and is financially conservative with one of the lowest debt equity ratio of 1.5:1.