Rel Power rises as NCL agrees to surrender land/news09012012

Shares of Reliance Power rosed nearly 3%, hitting the weekly high of Rs75.70, on reports state-run Northern Coalfields ( NCL) has agreed to surrender land required to mine two blocks attached to the Sasan ultra mega power plant to Reliance Power.

Coal from the mines - Moher and Moher Amlohri - along with another Chhatrasal block will fuel Reliance Power's Sasan and Chitrangi projects of 4,000 megawatts, each being built in Madhya Pradesh with an investment of Rs36000 crore.

According to reports, state-run Northern Coalfields ( NCL)'s plan to to surrender land to Reliance Power reportedly gives the Anil Ambani Group company the benefit of over Rs6000 crore over the life of the venture.

According to reports, NCL's decision, subject to a final nod by the coal ministry, will give Reliance Power access to 58 million tonnes of coal worth Rs6264 crore at current prices.

NCL, a Coal India subsidiary, had denied transferring required land to Sasan Power, a subsidiary of Reliance Power, saying such a move would violate the Coal Bearing Areas Act, 1973. NCL, however, reviewed its stance after a coal ministry directive to transfer surface rights to Sasan Power.

Last week, Reliance Power announced that its commercial paper was assigned a rating of '(ICRA A1+)' (pronounced as ICRA A one plus) by ratings firm ICRA. This rating indicates that the instrument has very strong degree of safety regarding timely payment of financial obligations. The instrument also carries the lowest credit risk.
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