It is seeking ``clarifications'' from two other thermal power plants, before issuing notices cancelling their coal linkages too. The ministry has decided to cancel the likages earlier granted to the 1000mw Sagardighi thermal plant, promoted by Development Consultants of UK, the 420mw Korba East plant proposed by Raipur Alloys and the 1000mw Anpara `C' power project in Uttar Pradesh, promoted by Hyundai.

The projects, said highly placed ministry sources, were unlikely to take off because of complex problems. The two 500mw generating plants expected to be set up for the Uttar Pradesh State Electricity Board (UPSEB) by Hyundai, may for instance, have been hit by the Southeast Asian currency crisis.

The similar project at Sagardighi, is too far off track now to figure among the 2000mwof power, for which the Madhya Pradesh government plans to grant an escrow account cover. A fuel link for the plant would only, therefore, deprive other projects nearing financial closure, of a coal linkage.

Notices have been issued to two other power projects, extending the time for the cancellation of the fuel supply agreement till September 30, this year. The Ib Valley III and IV units of 500mw each, promoted by AES Transpower of the US, the 800 MW Jawahar plant of Pacific Electric and the 300mw Narela power plant of Apollo Energy have been granted a time extension, since the time limit granted to them, for submitting detailed project reports (DPRs) have also been stretched.

The coal ministry is seeking clarifications from Indo-Gulf Fertilisers, which is setting up a thermal power plant at Roza and BPL, which is setting up a plant at Ramagundam, before deciding to snap their coal links as well. The exercise is part of a drive to reassess the demand for coal.

The present thinking is that many of the18 power projects expected to be commissioned during the Ninth Plan will get delayed or scuttled. The demand estimates for coal will consequently get considerably truncated to roughly 9.6 million tonne from 25 million tonne, estimated initially.

The inflated estimated could in turn influence unwarranted investments in new mines. Linkages from coal mines tied to power plants unlikely to take off, could hold up projects that could otherwise achieve financial closures.