A top NTPC official confirmed to The Financial Express that an offer was made by the oil giant for jointly developing the project.

"Due to ongoing problems with West Bengal, after power supply was regulated from the Farakka power station, National Thermal Power Corporation does not want to take up any new project in the state at the moment," he added.

Unperturbed by NTPC's refusal, IOC is currently in the process of tying up the transmission facilities for evacuation of power from this plant and has initiated talks with the Power Grid Corporation of India Ltd (PGCIL) in this regard.

Sources said that soon after the finalisation of the transmission facilities, IOC will scout about for new joint venture partners for the project.

Several foreign companies along with leading financialinstitutions and banks have evinced interest in picking up a stake in the project. IOC has decided to retain at least 26 per cent in the project, sources said.

Industrial Development Bank of India (IDBI), appointed by IOC to conduct a financial appraisal of the power plant at Haldia, has pegged the cost of this project at Rs 3,886 crore.

The project will have a debt-equity ratio of 65:35, with a foreign exchange component of Rs 1,412 crore and a rupee component of Rs 2,474 crore.

Considering the huge power surplus in the state, IOC has been asked by the West Bengal State Electricity Board (WBSEB) to evacuate the entire power out of the state.

IOC has asked PGCIL to work out a scheme along with the composite transmission system evolved for evacuation of power from other plants of NTPC and Damodar Valley Corporation (DVC).

IOC, sources said, has already initiated talks with the northern states including Delhi, Punjab and Haryana, which have evinced interest in buying power from the project. DespiteNTPC's refusal to join hands with IOC for this project, the two public sector navratnas are engaged in talks for a series of other power projects.

IOC, which is in the process of putting up a series of power plants based on the residual fuels from its forthcoming refineries, has offered equity stakes to leading public sector companies like NTPC and the Oil and Natural Gas Corporation (ONGC) in these projects.

Negotiations between IOC and NTPC are under way over the former's 500mw power project in Gujarat where Destech of US is the third joint venture partner. IOC along with Destech will hold 26 per cent each and NTPC has been offered a maximum of 24 per cent.