TNGCPL terminates contract awarded to BGR for North Chennai Super Critical Thermal Power Project, Stage III

Tamil Nadu Power Generation Corporation Ltd (TNGCPL) has terminated contract awarded to BGR Energy Systems Ltd. for the establishment of 1 x 800 mW North Chennai Super Critical Thermal Power Project, Stage III – Balance of Plant (BOP) package along with allied civil works engineering, procurement and construction (EPC) contract worth ₹2,600.02 crore, citing the non-fulfillment of key project obligations among others.

In a stock exchange filing, BGR said it received the termination letter from TNGCPL on July 18. TNGCPL cited various reasons for termination of contract, including the contractor being unable to fulfil key project obligations, critical systems remaining incomplete, and the contractual requirements for insurance renewals and guarantee extensions were not met, according to BGR.

The company said it is awaiting a positive outcome from the Arbitration application pending before the Madras High Court in this matter and said there is no major impact on its financials and operations.

North Chennai Super Critical Thermal Power Project Stage-III (1x800 mW) is situated in Tiruvallur district. The Super Critical 800 mW project cost, including Interest During Construction (IDC), is ₹10,158 crore, according to the State Energy Department policy note for 2025-2026.

The Project was commissioned and inaugurated by Chief Minister M.K. Stalin in March 2024. The unit was synchronised using coal firing on 17.03.2024, and achieved full load by 27.06.2024. Further, a trial run was started on 20.03.2025 and is continuously operating. It has also reached its maximum capacity of 675 mW during the trial run on 28.03.2025. All steps are being taken to achieve the date of commercial operation as soon as possible, the policy note said.

Once the plant reaches its installed capacity of 800 mW and operates continuously for 72 hours, it will be considered a power plant. It is designed to operate with 50% Imported and 50% Domestic Coal.

Earlier, TNPGCL had terminated the EPC contract awarded to BGR for the 660-MW Ennore Thermal Power Station (ETPS) expansion project, due to slow progress and poor performance.