Power on hold

Equity holders: Enron: 65 per cent, GE, USA: 10 per cent, Bechtel Corp, USA: 10 per cent; Maharashtra Power Development Corporation Ltd (MPDCL)— a subsidiary of MSEB: 15 per cent.

Enron is now under liquidation. GE and Bechtel recently bought 49 per cent of the shares of a shell company (Offshore Power Production) from the liquidators of Enron and have an option of purchasing the balance 51 per cent as well. GE & Bechtel now have a direct holding of 59 per cent and effectively control 85 per cent of DPC

LEGAL BLOCKS

• MSEB has filed a case that all arbitrations should be handled by Maharashtra Electricity Regulatory Commission after the enactment of Maharashtra Electricity Regulation Act. This has been contested by DPC. The cases are pending before the Supreme Court

• Phase-I became operational in May 1999 and Phase-II was nearly complete when disputes arose two years later between Maharashtra State Electricity Board and DPC over power tariff and payments. The plant was shut down in June 2001

• The DPC asked the Government of India to pay Rs 1376.5 crore as counter guarantee for bill and interest on payments that MSEB owed. DPC has initiated arbitration proceedings in London that were suspended through a Delhi High Court order. DPC has filed arbitration against MSEB and GoM but the proceedings are again stalled by court orders

• Overseas Private Investment Corp (OPIC) insured equity investment by Enron, GE, Bechtel and loans by Bank of America against political risk. OPIC says it has paid them all except Enron which it’ll do soon. It’s asked India to compensate the $111 million it has to pay

• GE and Bechtel invested in the project through Capital India Power Mauritius I (CIPM I) and Energy Enterprises Mauritius Co (EEMC) respectively. Since the Government of India has a bilateral treaty (BIPA) with Mauritius, CIPM I and EEMC have initiated arbitration against the GoI to recover $6 billion. The final date of hearing is July 2005 for which the government recently selected a new legal team

• Under BIPA, foreign lenders have claimed $205.9 million. They are ABN AMRO Bank, ANZEF Ltd, BNP Paribas, Credit Lyonnais, Credit Suisse First Boston, Erste Bank der Oesterreichischen Sparkassen AG and Standard Chartered Bank

• Offshore Power Production (OPP), a Netherlands-based company that now owns 16.86 percent in the project through Enron Mauritius Co, has filed a Notice of Claim under the Indo-Netherlands Investment Promotion Treaty