The Dabhol power plant is expected to begin generating electricity again by September after being closed for five years, and will be fuelled by naphtha, a senior oil ministry official told Reuters on Thursday.
"We will need 16,000 tonnes a month. After three or four months, we hope to start using natural gas," said the official, who did not want to be identified.
The $2.9-billion Dabhol project, built by Enron Corp, was shut down in May 2001 after a billing dispute with its sole customer, the state-run Maharashtra State Electricity Board.
At the time of closure, the plant's operational first phase -- capable of generating 744 MW of electricity out of a total target of 2,184 MW -- was being fuelled by naphtha, while the second phase was nearing completion.
Dabhol was designed to eventually use gas and has affiliated facilities to import liquefied natural gas (LNG).
The official did not say from where the plant would source the naphtha. "We have huge volumes in India and naphtha can be freely imported," he said.
India has become a major naphtha exporter over the past two years as expanded refineries ramp up production and cheaper LNG imports have increasingly been used to manufacture fertiliser and fuel power plants.
{{/usCountry}}India has become a major naphtha exporter over the past two years as expanded refineries ramp up production and cheaper LNG imports have increasingly been used to manufacture fertiliser and fuel power plants.
{{/usCountry}}India's monthly naphtha exports stand at 450,000 tonnes, three times the 2003 level.
The Dabhol plant is being revived by Ratnagiri Gas and Power Pvt Ltd, owned by gas transmission firm GAIL India Ltd and the National Thermal Power Corp Ltd.