The 50:50 joint venture of Whessoe-Punj Lloyd sent a notice of default on March 16 to RGPPL, the owner of the 2,150 MW power plant as well the adjacent unfinished five million tonnes LNG receipt facility, for clearing all payments due against work already completed.

The JV has threatened to take legal action against RGPPL in Singapore and remove its equipments from the site if the payments are not made by April 2, official sources said.

The Punj Lloyd spokesperson was not available for comments. RGPPL has paid only Rs 68 crore (Rs 680 million) against Rs 317 crore (Rs 3.17 billion) worth of work executed on LNG jetty and dredging.

"Bills worth Rs 265 crore (Rs 2.65 billion) are pending with RGPPL," a source said. The JV was awarded a Rs 500 crore (Rs 5 billion) contract for completing the jetty facilities in June last year with a target date of July 2007 for completion. Besides, Rs 51 crore (Rs 510 million) of dredging work and Rs 15 crore (Rs 150 million) of marine work was also awarded.

When RGPPL, a joint venture of NTPC Ltd, Gail (India), IDBI-led lenders and Maharashtra State Electricity Board, took over the Dabhol project in 2005, only one of the three power blocks was in operational condition and the LNG terminal was 85 per cent complete.