A few brief updates:
The hearing before the Bombay High Court regarding MERC jurisdiction is still on for Monday. We are still not sure whether or not there will be anything substantive discussed at the hearing. Gail Brownfeld and Christopher Walker are flying to Bombay just in case. I just spoke with Jim McCartney and he is planning to try to attend as well.
There was no unified "message" from the lenders at the conclusion of the Singapore lenders meetings. Our Finance guys are pretty confident that the offshore lenders will not cure the construction contract defaults this month. The Indian banks may or may not cure. If no one cures, the construction contracts will terminate in mid-June.
We received a copy of a very interesting letter from the Chairman of MSEB to the India Central Electricity Authority and copied to GOM dated January 11, 2001 (less than three weeks before we were first accused of misdeclaring). The Chairman states:
"The high price of Dabhol power today was perhaps not accurately anticipated. . . .DPC Phase II trial runs are to commence shortly. . . .It is a fact that we have not been able to fully absorb even DPC phase I power at 90% PLF. . . .[O]nly on MSEB projections and certification DPC have invested a huge sum in Phase II. Can we ask them to stop now? Poor off-takes of DPC power are not just because of low demand, but also on account of the high price and the poor financial condition of MSEB. We would be grateful for Government advice in the matter."
It appears to me that the "advice" was to charge that DPC was misdeclaring its availability and to demand huge offsets as a result.