Maharashtra government eyes Enron plant revival

Maharashtra government eyes Enron plant revival

Wednesday, 10 November 2004, 08:00 Hrs
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MUMBAI: Maharashtra's new government hopes to revive a power plant built by now-defunct US energy major Enron to tide over the state's huge electricity shortfall.

According to sources, Chief Minister Vilasrao Deshmukh and his deputy, R.R. Patil, have already held meetings with officials of the Maharashtra State Electricity Board (MSEB) on the issue.

They feel the project's foreign partners like General Electric and Bechtel and international financial institutions were a major hurdle in the way of reactivating the Dabhol Power Corporation's plant.

The plant, whose first 740 MW unit was functional, has been shut for almost three years due to a dispute over the price the MSEB was to pay for purchasing its power.

The plant has a capacity of 2,184 MW after both its phases are completed. The second phase had been nearing completion when it was shut.

Maharashtra faces a peak power shortage of 2,600 MW and the Dabhol plant could help in overcoming this.

A group of ministers (GoM) set up by the central government is already exploring the possibility of reviving the project. Among the proposals are its takeover by the cash-rich National Thermal Power Corporation (NTPC) and the Gas Authority of India Ltd (GAIL). Other alternatives include the two corporations running the plant on a contract basis.

Reports say one of the suggestions the union government has made is that the NTPC operate the plant on a fee basis.

The Oil and Natural Gas Corporation (ONGC), Tata Power and Reliance have also made known their interest in reviving the project.

The revival would however depend on the Indian lenders to the project buying out the 30 billion ($664 million) debt of their foreign counterparts.

Source: IANS
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