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The Ratnagiri Gas & Power Pvt ltd (RGPPL), which operates 1,967 MW project previously known as Dabhol project, has indicated that it will be able to service debt to lenders till June only.
Thereafter, the company has conveyed to the lenders comprising IDBI Bank, ICICI Bank, State Bank of India and Canara Bank that it won't have necessary funds to service debt as the project has been completely closed from February 21 and the MahaVitaran has stopped payment towards power purchase since then.
The company is currently able to service debt from its cash reserves which are of the order of Rs 300 crore.
ICICI Bank, IDBI Bank, State Bank of India and Canara Bank collectively hold 18.12% equity in the Ratnagiri Gas & Power Pvt Ltd, which operates the plant. The balance equity is held by 32.74% each by NTPC and GAIL and 16.94% by MSEB Holding Company.
RGPPL official told Business Standard "The issue was discussed at length at the board meeting held on March 25. Lenders were insisting for regular debt servicing as they were quite worried about their outstanding debt of Rs 9,000 crore. RGPPL currently requires about Rs 100 crore for debt servicing every month after meeting its running expenses. Therefore, the company has conveyed clearly that it will be able to service the debt till June from the present cash reserves of Rs 300 crore." The official admitted that the the future of the project as a whole is quite uncertain as the company has not yet received any indication from the Centre for the restoration of gas allocation from Reliance Industries' KG D6 basin.
Another RGPPL official said lenders may announce a moratorium of six months or one year after June if the company is unable to service the debt. "After the moratorium ends and RGPPL fails to repay the loan then there is a every possibility that the lenders will take over the assets and approach Debt Recovery Tribunal for its disposal," the official said.
However, the official said the company was also banking on the outcome of its petition filed at the Central Electricity Regulatory Commission. "RGPPL has appealed that MahaVitaran, which draws 95% of the power from the Dabhol project now known as Ratnagiri project, should take the responsibility of debt servicing. If the CERC upholds our plea then the picture will change," he noted. The official however, said if the gas is not restored and CERC dismisses RGPPL's plea then there is every possibility that the project will turn NPA.
MahaVitaran official rejected RGPPL's proposal saying that it was not prepared to take the responsibility of debt servicing. ""The onus clearly lies on RGPPL which has to organize the KG D6 gas at an acceptable rate as per the power purchase agreement. MahaVitaran has opposed RGPPL's move to go in for RLNG to run the project," the official said.
As reported earlier, RGPPL has been allocated 8.5 million metric standard cubic meter per day (MMSCMD) of gas to operate plant at its full capacity. This comprises comprising 7.6 MMSCMD from RIL and .09 MMSCMD from ONGC through GAIL India at $4.20 million British thermal unit (mmBtu).
However, the company has been receiving much less quantity during 2011-12 and during current fiscal. Till date there has been a generation loss of 8,387 million units while the loss in rupee terms will be about Rs 3,000 crore during 2012-13 as on date. The project received an average 2.67 MMSCMD of gas. In last fiscal 3,095 MUs of generation was lost as the company received an average 6.3 MMSCMD of gas. The loss will be of the order of Rs 1,150 crore. Despite gas allocation to Dabhol project is considered on a priority list after fertilizer sector, the company is unable to get it.”
