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NTPC not to buy Enron stake in DPC: Centre

The Centre has ruled out the possibility of National Thermal Power Corporation buying out US energy giant Enron's stake in the controversial Dabhol Power Company.

Union Power Minister Suresh Prabhu is learnt to have said this during the meeting with Enron chairman, Kenneth Lay, who was in New Delhi last week to discuss the fate of the $ 3-billion project, which is embroiled in a payment controversy with Maharashtra State Electricity Board, highly-placed government sources said.

The Enron team, led by Lay, discussed several options, including an exit route in which the government takes over the beleaguered $ 3-billion Dabhol Power Project, they said.

Though exact details of the meeting were not forthcoming, sources familiar with the discussions said that it was suggested that the government takeover could possibly be done through NTPC or a special purpose vehicle involving NTPC taking over the plant and selling power to the National Grid.

Enron, which holds 65 per cent interest in DPC, is scouting for Indian companies who can take over its equity worth over $ 800 million in DPC.

Ruling out the option outright, Prabhu had pointed out that there was no question of NTPC buying Enron stake in DPC saying that NTPC was not in the business of taking over sick companies.'

Both DPC and MSEB have been locked in a wrangle for more than six months over payments. In May, Enron issued a preliminary termination notice after MSEB defaulted on payments, and the state utility, stopped taking power from the embattled $ 2.9-billion plant.

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