Govt puts off privatisation plan for Dabhol gas plant
The UPA government is understood to have deferred its decision to privatise Ratnagiri Gas and Power Project’s (RGPPL) regasification plant at Dabhol.
By Girish Kuber, TNN |
MUMBAI: The UPA government is understood to have deferred its decision to privatise Ratnagiri Gas and Power Project’s (RGPPL) regasification plant at Dabhol.
Instead, the existing stakeholders in erstwhile Dabhol Power Company would be asked to bear the cost of the gas plant.
The decision regarding not to privatise the regasification plant was taken at a meeting of the empowered group of minister (eGoM) held this week in New Delhi.
The eGoM is also understood to have discussed ways to bridge the project’s revival cost, which, according to government estimates, has escalated to Rs 12,897 crore from Rs 2,594 crore earlier. One of the options to raise the necessary funds for the same was to hive off the LNG terminal and regasification plant for which many have shown interest. The government initially wanted to use the proceeds of this deal to bridge the escalation cost of the project.
The terminal for liquefied natural gas is a part of the Enron’s ill-fated 2,160-MW Dabhol power company, now called Ratnagiri Gas and Power Project. The project is awaiting rejuvenation since May 2001.
The project was revived with central PSUs — NTPC and Gail — each picking up 28.33% stake in it. Other stakeholders include Maharashtra State Electricity Board (MSEB) that owns 15% and lender banks like IDBI, State Bank of India, ICICI Bank and Canara Bank having minority stakes.
With the Centre looking forward to Oman for long-term LNG supply, efforts were on to revive the gas terminal and regasification unit. This is vital for the project as the LNG that’s transported in liquid form usually by ship needs to be converted into gas before it is used. Currently, India has only two LNG regasification terminals, both located in Gujarat and are owned by Petronet LNG and Shell India. Once started, the Dabhol terminal will initially have a capacity of 1.2 million tonnes per annum (mtpa), which eventually will be scaled up to 5 mtpa by 2010.
As of now, plans have been drawn to bring in gas from Gujarat through recently completed Dahej-Uran and Uran-Panvel-Dabhol gas pipelines. Petronet LNG has tied up imports of 1.5 million tonnes (mt) of LNG from Qatar and Algeria to feed the plant.
With monsoon showing withdrawal symptoms, the state government is gearing up to meet the rise in demand for electricity. As result, efforts are on to re-fire the Dabhol plant.
Petronet LNG has been asked to ensure the gas supply for Dabhol until September 2009, after which Gail will take responsibility for supplies.
Instead, the existing stakeholders in erstwhile Dabhol Power Company would be asked to bear the cost of the gas plant.
The decision regarding not to privatise the regasification plant was taken at a meeting of the empowered group of minister (eGoM) held this week in New Delhi.
The eGoM is also understood to have discussed ways to bridge the project’s revival cost, which, according to government estimates, has escalated to Rs 12,897 crore from Rs 2,594 crore earlier. One of the options to raise the necessary funds for the same was to hive off the LNG terminal and regasification plant for which many have shown interest. The government initially wanted to use the proceeds of this deal to bridge the escalation cost of the project.
The terminal for liquefied natural gas is a part of the Enron’s ill-fated 2,160-MW Dabhol power company, now called Ratnagiri Gas and Power Project. The project is awaiting rejuvenation since May 2001.
The project was revived with central PSUs — NTPC and Gail — each picking up 28.33% stake in it. Other stakeholders include Maharashtra State Electricity Board (MSEB) that owns 15% and lender banks like IDBI, State Bank of India, ICICI Bank and Canara Bank having minority stakes.
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With the Centre looking forward to Oman for long-term LNG supply, efforts were on to revive the gas terminal and regasification unit. This is vital for the project as the LNG that’s transported in liquid form usually by ship needs to be converted into gas before it is used. Currently, India has only two LNG regasification terminals, both located in Gujarat and are owned by Petronet LNG and Shell India. Once started, the Dabhol terminal will initially have a capacity of 1.2 million tonnes per annum (mtpa), which eventually will be scaled up to 5 mtpa by 2010.
As of now, plans have been drawn to bring in gas from Gujarat through recently completed Dahej-Uran and Uran-Panvel-Dabhol gas pipelines. Petronet LNG has tied up imports of 1.5 million tonnes (mt) of LNG from Qatar and Algeria to feed the plant.
With monsoon showing withdrawal symptoms, the state government is gearing up to meet the rise in demand for electricity. As result, efforts are on to re-fire the Dabhol plant.
Petronet LNG has been asked to ensure the gas supply for Dabhol until September 2009, after which Gail will take responsibility for supplies.
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