BUSINESS STANDARD, Thursday, October 18, 2001
BSES moves ministry over Enron's stake in DPC, S Ravindran 
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THE ECONOMIC TIMES, Thursday, October 18, 2001
Maha to challenge London court order on DPC

Similar story also appeared in the following publications:

THE DECCAN CHRONICLE, Thursday, October 18, 2001
Maharashtra to move London court in a week

THE DECCAN HERALD, Thursday, October 18, 2001
Mrashtra to move London court in Enron case

THE HINDU, Thursday, October 18, 2001
Maharashtra to move London court in Enron case 

THE HINDU BUSINESS LINE, Thursday, October 18, 2001
Enron: Maharashtra to move London court in a week

BUSINESS STANDARD, Thursday, October 18, 2001
State to appeal London court ruling on DPC
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THE HINDU, Thursday, October 18, 2001
NCP to be blamed (Letters to the Editor)
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THE HINDU BUSINESS LINE, Thursday, October 18, 2001
GAIL keen on Dabhol LNG terminal project, Balaji C. Mouli 
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THE HINDU BUSINESS LINE, Thursday, October 18, 2001
Govt rejects Coke's plea on waiving IPO 
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BUSINESS STANDARD, Thursday, October 18, 2001
BSES moves ministry over Enron's stake in DPC, S Ravindran 

After a series of flip flops, power major BSES has formally communicated to the Union government that it is interested in buying out Enron's stake in the Dabhol Power Company (DPC). It has, however, added the now-familiar rider that the capital cost of the project should be brought down. BSES chairman and managing director R V Shahi said, "We have formally told the ministries of power, finance and financial institutions Industrial Development Bank of India, ICICI and the State Bank of India that we are interested in the project. The communication was despatched last Saturday." Shahi also said that a financial re-engineering of the $3 billion, 2,184-mw power project was necessary so that the cost of power was affordable. 

Analysts, however, queried the seriousness of BSES's intentions in view of the various conflicting statements made earlier by Shahi. He has made public statements that the company is interested in the project but has denied them in communications to the Bombay Stock Exchange. Sources familiar with an earlier round of discussions with Enron say that BSES had offered to buy the equity at a 90 per cent discount. This would have meant BSES paying only around $120 million for the 85 per cent stake that Enron and its two US partners -- General Electric and Bechtel -- hold in the company. The three partners have so far invested around $1.2 billion in the project. Tata Power managing director Adi J Engineer insisted that the company was still interested in the Dabhol project. "We have not held any serious discussions on the issue in the last fortnight but discussions will resume shortly. There is no roadblock and the final outcome will depend upon the sacrifices willing to be made by all the stokeholders in the project," he said. Engineer refused to divulge further details. The lenders to the project have mooted a three-pronged formula for the sale of power from the Dabhol power project. The entire power from the 740-mw first phase of the project should be bought by the Maharashtra State Electricity Board. Half the power from the 1,444-mw second phase will be bought by the central government utility, National Thermal Power Corporation, while the other half will be sold within Maharahstra for which a dedicated region will be allotted to Tata Power. 
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THE ECONOMIC TIMES, Thursday, October 18, 2001
Maha to challenge London court order on DPC

THE MAHARASHTRA government has decided to challenge the injunction order issued by the commercial court in London restraining the state from filing suits against the Dabhol Power Company (DPC) in India. The DPC had obtained the injunction on October11. "The state government has decided to challenge the order as we feel that the concerned court should have heard the state as well. Within a week we would be presenting our case," the state chief minister Vilasrao Deshmukh said here on Wednesday. The ex-parte order relates to arbitration proceedings between the state government and DPC with respect to state guarantee, state support and supplemental state support agreements. It prevented the state government from taking any legal action in India, challenging the international arbitration proceedings initiated by DPC. Mr Deshmukh today also reiterated his government's resolve not to draw electricity from DPC. "There is no logic in buying DPC power at higher rate and selling it with much lower rates," Deshmukh said. According to Deshmukh, due to recent rainfall, the demand for electricity has gone down considerably and the state electricity board is supplying power without interruption. Meanwhile, the government today expressed its resolve to initiate a judicial probe into the entire Enron deal. "The probe would begin in few weeks ," Deshmukh said. The state has already requested the Chief Justice of the Mumbai High Court to appoint a judge for the probe. 
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THE HINDU BUSINESS LINE, Thursday, October 18, 2001
GAIL keen on Dabhol LNG terminal project, Balaji C. Mouli 

GAS Authority of India Ltd (GAIL) has written to both the Petroleum Ministry and the Power Ministry evincing interest in the 5 million tonnes per annum (mmtpa) LNG regassification terminal of the Dabhol Power Company, according to Government officials. In a recent communique to the two Ministries, it has asked the financial institutions to set up a meeting to enable it review the financial details of the LNG project. The financial data on the LNG project solely rests with Bechtel, GE and Enron.As a first step towards examining the financial data, GAIL will require to enter into a confidentiality clause agreement with the present project sponsors to access the data.

Meanwhile, the financial institutions are awaiting the results of political parleys between the Centre and the Maharashtra Government towards bringing the latter into a `solution finding' mode to implement a financial restructuring package and resolve the Dabhol crisis. Once this is done, the FIs will freeze the financial package - involving sacrifices undertaken by the present stakeholders - and again elicit market response towards bettering the Tatas' proposition. Although the FIs had earlier scouted the market and found only the Tatas evincing interest in the project, it would again offer the Dabhol project to the market to ensure that the concessions on the part of the State are not awarded on a nomination basis.The foreign lenders have pointed out that they would not be agreeable to the domestic FIs spearheading the salvage operation finally resulting in transfer of ownership of the power plant. Hence, the Government is mulling a high-level committee to implement the process leading to transfer of ownership. 
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THE HINDU, Thursday, October 18, 2001
NCP to be blamed (Letters to the Editor)

Sir, - Mr. Prem Shankar Jha's article `Dabhol and the do nothing Government' (Oct. 16) is interesting. The blame for the present situation should squarely rest on the NCP Government in Maharashtra. The Congress, to square points with Mr. Pawar, has created problems in implementing the second phase. With 90 per cent work complete, it is not in the national interest to give it up at this stage. It is time the Prime Minister devoted some attention to resolving the issue. The Centre should ask the NTPC to take over the responsibility of running this unit by providing financial help. The Government should sit with the DPC and settle for a final takeover and finish the work and start generating power. 
V.R. Rajamani, 
Chennai 
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THE HINDU BUSINESS LINE, Thursday, October 18, 2001
Govt rejects Coke's plea on waiving IPO 

Government said today that it would not accede to Coca-Cola's request for exemption from mandatory divestment of equity, as this would be tantamount to 'favouritism'. "It (the agreement signed between Coca-Cola and the government of India at the time of company's entry) won't be changed. They wanted it to be changed, but this can't be for a particular company. It will amount to favouritism," Commerce and Industry Minister Murasoli Maran told reporters here.Replying to a query at the Annual Economic Editors' Conference on whether government could reconsider Coca-Cola's proposal, he said "MoU norms are the same for everybody. These cannot be changed for one single company.

Mr Maran also dismissed dispute surrounding Enron's Dabhol Power project as isolated, saying such cases were unlikely to affect Foreign Direct Investment inflows into India. "Enron is only an isolated incident... There are many success stories on FDI front," Mr Maran said, adding even the Enron issue was not closed and negotiations were on to resolve the crisis. He said Enron's Dabhol Power Project was financed by domestic institutions to the extent of up to 80 per cent and this was a matter of concern for the country. Government is yet to communicate its decision on the Coke's request for waiver of 49 per cent disinvestment from it Indian holding or alternatively a five year moratorium till July, 2007.
 
Asked about reports that the Foreign Investment Promotion Board (FIPB) had allowed a moratorium, Industry Secretary Govindrajan told PTI "we have not communicated any decision to the company so far." Coke has cited mounting losses, which have wiped out its networth by a whopping 66 per cent on Rs 3,200 crore investment since 1993 in Indian operations, as the main reason for seeking disinvestment waiver.Company officials had earlier claimed that the Indian venture would strive to break even during the current financial year with Rs 4,000 crore turnover target but will take some more time to wipe out the accumulated losses. A 66 per cent erosion in networth means devaluation in the book value of Coke's 10-rupee share by the same proportion, a situation unacceptable for a company which claims numero uno position in the Indian soft drinks market.