New Delhi: Finance Ministry on Thursday discussed with lenders the option of hiving off LNG terminal of the beleaguered Dabhol power plant for sale to cut debt.
The banks, who run the risk of their loan to Ratnagiri Gas and Power Pvt Ltd (RGPPL) - the operator of 1,967 MW Dabhol power plant and the adjacent 5 million tons a year liquefied natural gas import terminal on the west coast, have been pushing for hiving off the terminal.
Finance Secretary Arvind Mayaram said, "Hiving off assets of Ratnagiri power plant were discussed to make Ratnagiri plant more viable."
Lenders - SBI, ICICI Bank, IDBI bank, Canara Bank and IFCI Ltd - have an exposure of Rs 8,500-9000 crore in the project and want to recover a third of it by selling a hived off LNG terminal.
The hiving off proposal, however, is being opposed by promoters NTPC and GAIL who feel without the LNG terminal the now-shut power plant will be no good.
NTPC and GAIL own 32.68 per cent stake each in RGPPL and have contributed close to Rs 1,000 crore in equity each since 2005. Maharashtra State Electricity Board holds 17.4 per cent stake in the project and the balance is held by the consortium of lenders.
Mayaram said a proposal for pooling of gas prices, or averaging out the price of domestic gas with imported LNG to make the fuel affordable, was also discussed at the meeting.
With domestic gas supplies drying up, RGPPL is left with the option of buying imported LNG for firing the idle power plant. Imported gas costs thrice the price of domestic gas and this leads to power tariff which are unacceptable to state electricity boards.
State Bank of India (SBI) Chairperson Arundhati Bhattacharya said, "Nothing is decided " on hiving off of assets.
