Rothschild, SBI Caps to pen Dabhol route map

The government is believed to have asked two investment bankers, N M Rothschild and SBI Caps, to work out a detailed proposal to revive the Dabhol power plant, which has been lying idle for over three years, for the consideration of empowered group of ministers.

This was decided at a meeting convened by cabinet secretary B K Chaturvedi, highly placed sources said, adding that the proposal would be basically on structuring of the project.

While NTPC has been mandated to operate the plant in the period prior to its selloff, Petronet LNG would operate the LNG terminal and GAIL India Ltd would scout for gas for the power plant.

Sources said GAIL chairman & managing director Proshanto Banerjee indicated that the company may be able to get 2.5 million tonnes of LNG from Indonesia.

The government wants to restart the plant and sell it off as a running unit to get a better price.

The EGOM, headed by defence minister Pranab Mukherjee, is likely to meet on November 18.

Earlier, at the behest of finance ministry, Rothschild had estimated a cost of about Rs 1,800 crore to restart the Dabhol power plant.

This is required to complete the liquefied natural gas plant, completion of phase-II and payment of contractual charges to GE and Bechtel, as per the estimates.

Petronet LNG, which has already done a round of inspection of Dabhol power plant, has put $145 million as the cost for completing and restarting the LNG terminal.

Besides the financial assessment, Rothschild had estimated a time period of 18 months to complete all the three facilities before regenerating power from the troubled plant.

According to the finance ministry's earlier communication to power ministry, "it is not certain that an early operation of phase-I can be viable as this may require running the plant on naphtha. Ministry of power may like to advise the empowered GOM on this aspect."

"If the plant is to be run on LNG, both phase-I, phase-II and LNG plant and breakwater will have to be completed. The approximate time required for power to flow will be 18 months from the start of construction as estimated by Rothschild," finance ministry had said.