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DPC urges MSEB to resume power off take, make 'protest payments'

In a late night statement, DPC spokesman confirmed 'that DPC will accept any further payments by MSEB that are owed to it under the Power Purchase Agreement'.

"This step has been taken with a view to further facilitate resolution of issues between DPC and MSEB and after discussions with DPC lenders," the statement said.

It said although MSEB had announced its rescission of the PPA, and DPC disagreed with this action, the multinational has advised MSEB that 'DPC's plant currently remains fully available to despatch power'.

"We will despatch such power per the PPA, subject to receiving despatch instructions from MSEB," DPC said.

DPC president Neil McGregor, along with representatives of the multinational's domestic and foreign lenders, had met MSEB chief Vinay Bansal on Friday evening and tried to persuade the board to commence drawing power from phase one (740 MW) of the $3 billion project, official sources said in Bombay on Friday.

McGregor also handed over a two-page letter pleading the same to Bansal, the sources said.

Sources said DPC's lenders also tried to convince MSEB officials to resume power off take and start making payments.

MSEB had stopped drawing power from DPC since May 29.

"DPC officials also expressed their readiness to accept MSEB's protest payments without any pre-conditions and also asked for payment of the pending Rs 1.34 billion April and Rs 1.4 billion May bills," they said.

MSEB officials told McGregor and the lenders that the payments for April and May were already adjusted in the Rs 12 billion claim made by the board in its petition filed against DPC at the Maharashtra Electricity Regulatory Commission (MERC).

With reference to drawing of power, Bansal made it clear to the US energy major that as per MERC's order, the board would have to buy 'costly' power as a last alternative.

Moreover, MSEB officials told McGregor that since DPC had slapped several notices, including pre-termination notice, political force majeure, arbitration and conciliation, the board would seek legal implications before taking any steps, official sources said.

With reference to the fate of DPC's 1,444 mw phase II, they said it was unanimously voiced that Centre should emerge as a buyer and also play an active role as a facilitator.

MSEB in its letter that rescinded the PPA had communicated to DPC that despite the non-recognition of the agreement the board was ready to take required power and also pay for the same, sources said.

The non-payment imbroglio between MSEB and DPC reached a high in June when both the parties adopted the legal course and knocked the doors of MERC and the Bombay High Court respectively.

Other than Bansal and McGregor, those present at the marathon two-and-half hour meeting were Industrial Development Bank of India (IDBI) executive director and DPC board member R S Agarwal and representatives of ABN Amro, Citibank N A and other foreign banks, ICICI Ltd and State Bank of India, the sources said.

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