Taking note of the operational mess and heavy defaults to leading lenders, including ICICI Bank, State Bank of India (SBI) and others, the operator of the beleaguered Dabhol power project — Ratnagiri Gas and Power Pvt Ltd (RGPPL), being promoted jointly by state-owned NTPC Ltd and Gail (India) Ltd, has hired global consulting firm Deloitte to work out a new business plan for effective functioning of the plant, currently lying idle due to dwindling gas supplies.
“Banks with a heavy exposure in gas-based projects, especially the Dabhol power project, have expressed serious concerns on viability and we need to address the fuel issue immediately,” Rajiv Takru, financial services secretary, told HT.
Shortfall in supply of domestic gas has sharply affected the plant’s operational and financial performance as its entire capacity of 1967 mw is currently stranded due to lack of domestic gas supply.
“RGPPL has engaged Deloitte as consultant for conception of a business plan in view of current gas shortfall scenario and other associated issues,” said a senior company official..
RGPPL has a debt of Rs. 9,000 crore and has defaulted in its debt servicing obligation in September, October and November 2013,” said a senior government official. “This is worrisome as the default has happened the first time after the project’s restructuring in 2009.”
If operations are not resumed and unless payments are made, there is a possibility of the project to be classified as a non-performing asset. RGPPL’s outstanding dues have ballooned to Rs. 1,017.64 crore as on November 25.
“The viability of RGPPL depends on viability of its power and LNG business on a standalone basis,” the official said.