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July 30, 2001
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Money > Business Headlines > Report July 30, 2001 |
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Enron row may sink Greenfield ShippingS Ravindran The row over the Enron-promoted power project may bring down the curtains on Greenfield Shipping Company-which was to undertake the transportation of liquefied natural gas to Dabhol's project in Ratnagiri in Maharashtra. Lenders to the company are planning to foreclose the mortgage on the LNG carrier Lakshmi being built at Japan's Mitsubishi Heavy Industries Shipyard. Greenfield is a 60:20:20 venture between Japan's Mitsui OSK Lines, Shipping Corporation of India and an Enron group company. The lenders to the project include ANZ Investment Bank, Bank of Nova Scotia and ABB Structured Finance. Confirming the move, SCI chairman P K Srivastava said, "There is a move in that direction and this issue is being debated. Under the agreement signed with the lenders, they definitely have a right to foreclose the mortgage if the continuance of the Dabhol project is in doubt. I am hopeful that the issue can be sorted out." Ironically, the move comes at a time when the ship is almost already. The 135,000 cubic metre ship is expected to be delivered by end-November. This ship was to be used to transport LNG to the Dabhol power project at Ratnagiri district in Maharashtra. The contract for transporting LNG to the project site was signed for 20 years at a confirmed charter of about $98,600 per day. The vessel is being built for about $220-230 million. The lenders have already sanctioned $110 million to the project but have suspended disbursement of $55 million. They have now made it clear that the promoters of the project will now have to cough up this amount. The 1,444 mw second phase was slated to be commissioned in December, 2001 The first phase of 740 mw was commissioned in May, 1999 with naphtha as fuel. The entire project of 2,184 mw was to be LNG fired after the commissioning of the second phase. The Maharashtra State Electricity Board, the sole buyer of the power from DPC has revoked the power purchase agreement and has made it clear that it will not be in a position to buy phase-II power due to the high cost. A committee headed by former home secretary Madhav Godbole is now trying to find a solution to the dispute through negotiations with DPC. YOU MAY ALSO WANT TO READ:
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