New Delhi, April 11 :
New Delhi, April 11:
Enron, the US energy giant, appears to be far more keen than its adversary, the Maharashtra State Electricity Board (MSEB), on reaching a negotiated settlement to the present controversy surrounding Dabhol Power Company (DPC).
According to diplomatic and official circles, Enron finds the present situation untenable. Though Enron's position may look legally sound, a protracted battle can scuttle its plan to get out of DPC.
Enron, in tune with its new corporate strategy, has already pulled out of all projects in the country except DPC. The US power major had already announced that it would sell its 30 per cent stake in oil and gas fields such as Panna, Mukta and Tapti. Besides, it withdrew from the Dolvi power project promoted by the Mittals' Ispat and scrapped the memorandum of understanding (MoU) with Indian Oil Corporation to transport imported gas.
The much-trumpeted joint venture with MSEB and Global Telesystems for laying optic fibre cables in Maharashtra, is also off. Enron is now saddled with only DPC which it may sell provided it finds a buyer.
Enron president Jeffrey Skilling has also gone on record, hinting the possibility of Enron withdrawing from DPC. 'We should not be there building a $ 2 billion power plant. Our cost is too high to do that.'
The difficulty in finding a buyer for the project lies in the fact that DPC's tariffs are unsustainable. The liquefied natural gas it has contracted is also expensive, as is the freight for transporting the LNG.
If the tariff, however, is lowered through a negotiated settlement, as recommended by the Godbole Committee, the task of locating a buyer will not be all that difficult. However, it is not clear whether the government will extend the same guarantee if the company changes hands.
Enron's position appears to be legally sound because its agreement with the SEB has been negotiated by its solicitors. However, the US power major realises that arbitration will prolong the uncertainty over the project. This is what happened to its plan to sell its stake in the oil and gas fields.