History of Dabhol Power Corporation
MAY-JUNE, 1992: India invites Enron to explore the possibility of building a large power plant in Maharashtra.
JUNE 20, 1992: Initial memorandum of understanding signed between Enron and the Maharashtra government for a plant with capacity of 2000-2,400 mw. The Maharashtra State Electricity Board is expected to pick up a 10 per cent stake.
JAN 2, 1993: The Foreign Investment Promotion Board clears proposal for a 1,920-mw plant, expandable to 2,550 mw.
DEC 8, 1993: Power Purchase Agreement signed between Dabhol Power Company and MSEB for a 2,015-mw project to be implemented in two phases.
MARCH-JUNE, 1995: Following state elections, a new Maharashtra government, headed by the Shiv Sena, scraps the project, alleging corruption and high costs.
NOV-1995: Project re-negotiated with a final capacity of 2,184 mw. MSEB's stake is upped to 30 per cent: 15 per cent in the first phase, and a further 15 per cent upon completion of the project.
MAY, 1996: India extends counter-guarantee to the project, under which the federal government promises to cover any defaults by the state utility.
MAY, 1999: Phase one of the project with a capacity of 740 mw begins operating.
JUNE-OCT 2000: Maharashtra government allies demand scrapping the project because of the cost of the power it produces.
OCT, 2000: MSEB defaults on its October payment to DPC.
DEC, 2000: Maharashtra state announces plan to review the project, stating that the tariff is too high.
JAN, 2001: Enron invokes the Maharashtra government counter-guarantee after MSEB defaults on both November and December payments.
FEB, 2001: Crisil cuts ratings on bonds issued by Maharashtra government due to defaults on payments owed to Dabhol. Enron invokes the Union government guarantee.
APRIL, 2001: Enron issues a notice of arbitration to the Indian government to collect on the December bill of Rs 102 crore.
APRIL, 2001: Enron invokes the political force majeure clause in its contract with MSEB, stating unfavourable political conditions have prevented it from fulfilling contractual obligations.
APRIL 23, 2001: DPC and its lenders meet in London to discuss the payments issue. Enron seeks lenders' permission to issue a notice of termination.
APRIL 25 2001: The board of Dabhol Power Company authorises management to terminate the contract any time it chooses. (Reuters)
|
