New Delhi: State-run power producer NTPC Ltd is likely to exit the beleaguered Dabhol power project in Maharashtra if the government hives-off the adjacent LNG import terminal and sells it to a third party.
NTPC Board is learnt to have taken the decision after a Committee of Secretaries headed by Cabinet Secretary K M Chandrasekhar virtually decided to sell the 5 million tonnes a year LNG import facility to stem massive cost overrun.
“NTPC wants the 2,150 MW gas-fired power plant and the LNG terminal to stay together and is against its hive-off,” a source familiar with the development said.
Project revival cost of Rs8,700 crore at the time of takeover of Dabhol, now stands at Rs23,640 crore.
The state-run company has won the right of first refusal on the facility when it had approved additional equity infusion of Rs500 crore last year.
Now, if the government decides to ignore its claim and invites bids from private firms like Reliance Industries, Anil Ambani Group, BG Group of UK, Essar Oil and Adani, the company would exit the venture, the source said.
NTPC and gas utility GAIL India hold 28.33% equity stake each in Ratnagiri Gas and Power Pvt Ltd, the company that now runs Dabhol power plant.
While NTPC Chairman R S Sharma was not available for comments, GAIL Chairman and Managing Director U D Choubey said his company favoured an integrated Dabhol power plant.
“We had invested in RGPPL on the premise that the power plant and LNG terminal would stay together. I am not aware of the decision to hive-off LNG terminal but if that happens, I will have to go to my Board to seek approval for staying invested in the changed project structure,” he said.