The Hindu Business Line : Dabhol SPV: Govt asks parties to finalise shareholders' pact

THE Government has directed NTPC, GAIL and the IDBI-led team of lenders to finalise within a week the shareholders' agreement for the newly formed special purpose vehicle (SPV) that would own and operate the $2.9-billion Dabhol power project.

"We have asked NTPC, GAIL, the lenders, and MSEB to finalise the shareholders' agreement within a week," said the Power Secretary, Mr R.V. Shahi, on the sidelines of an event organised today for launching the Management Development Institute, Gurgaon's PG diploma course in energy management.

He added that the parties had also been told to finalise the power purchase agreement (PPA) within a week.

NTPC, GAIL and the Indian lenders will hold 28.5 per cent each in the SPV called Ratnagiri Gas and Power Pvt Ltd, which has taken over the assets of the erstwhile Dabhol Power Company (DPC). MSEB will hold the remaining 15 per cent.

Power from the project would be priced at Rs 2.30 a unit, with fixed cost at 93 paise, regassification cost at 17 paise, and fuel cost at Rs 1.20 per unit.

The LNG for the project has, however, not been tied up as yet and talks are under way to secure a fuel linkage, officials said.

Earlier during the day, the Law Minister, Mr H.R. Bhardwaj, said that all cases relating to DPC had been settled and that electricity generation from the 2,184 MW gas-based plant will begin by July next year. "We have settled all cases relating to Dabhol power project out of court."The Centre has reached an out-of-court settlement with GE and Bechtel, the majority equity holders in DPC.

This comes just days before the July 18 date set at a London arbitration panel to hear the cases filed by GE and Bechtel.

The two foreign equity holders had filed arbitration claims worth over $6 billion (over Rs 25,000 crore) at the London Council for Arbitration for breach of investment protection pacts, which have now been settled.

Besides the equity holders, the Indian lenders have settled the dues of overseas lenders at $230 million, while that of the US Government-promoted Overseas Private Investment Corporation have been settled at $220 million.

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page