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Enron India talks centre on DPC sale

Creditors of ruined energy giant Enron Corp's $2.9 billion Dabhol power station project met in Singapore on Thursday to find a new investor to revive the stalled project, bankers said.

"The thrust of the whole talks is the sale of the Enron stake to prospective bidders and the process of due diligence," chairman of the Industrial Development Bank of India PP Vora said. "By tomorrow (Friday) we will have the agreement on the complete roadmap."

Vora said lenders held talks in Singapore with top executives from Tata Power Co and BSES Ltd, which are prospective bidders for the stake.

IDBI is one of the lead lenders to the Indian project.

Enron owned 65 per cent of Dabhol Power Co, which has an almost complete 2,184 megawatt electricity producing project in Maharashtra.

The meeting, the first since Enron filed for Chapter 11 bankruptcy protection in the United States last week, is set to continue on Friday.

The lenders represented have exposure of about $1.9 billion to Dabhol Power Co.

Overall, Enron Corp says it has about $15 billion in bank debt, of which only about $2 billion is secured.

Indian financiers -- led by state-run term lender IDBI, ICICI Ltd and the State Bank of India -- have exposure of about $1.4 billion.

Foreign lenders -- which include Citibank, Bank of America and ABN AMRO -- have lent about $500 million to the Indian project.

INDIAN PLANT GATHERING DUST

In addition to Enron's stake in Dabhol, General Electric Co and construction firm Bechtel Corp each own 10 per cent and the Maharashtra State Electricity Board, a state-owned utility, holds the remaining 15 per cent.

Dabhol stopped work on the second phase of the power plant, once a showpiece of India's foreign investment, following a dispute with the state electricity board, the plant's sole customer.

The plant has been idle since June and Dabhol has laid off all of its employees. Enron has said it wants to exit the project and sell the stake of all three foreign shareholders.

In the weeks before Houston-based Enron's spectacular collapse last month, all parties involved in the Dabhol project, including Indian and foreign lenders, were hoping to resolve the matter by finding a buyer for the plant and adjacent liquefied natural gas terminal.

Tata Power and BSES have demonstrated strong interest in picking up the stake, but Enron's bankruptcy has further complicated the process.

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