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Enron Mail |
Good thought. The executive team is having a pow-wow in the morning.
Meanwhile, my group and I continue to assist MSEB on their rate case (and a response to another complaint.) ---------------------- Forwarded by Jane Wilson/ENRON_DEVELOPMENT on 11/27/2000 08:48 PM --------------------------- Mark Schroeder@ECT 11/27/2000 12:24 PM To: Jane Wilson/ENRON_DEVELOPMENT@ENRON_DEVELOPMENT cc: Steven J Kean/NA/Enron@Enron@ENRON_DEVELOPMENT, Mark Palmer@ENRON@ENRON_DEVELOPMENT Subject: Re: URGENT. Good morning to MSEB problems. If I understood Wade correctly at mid-year PRC, our GOI guarantee is only for about 1/3 of the offtake. Not sure we would want to be confrontational, as they seem to hold a good hand, i.e., they want, and they are bankrupt, so they do not pay. Being aggressive did work on Phase I repudiation, but query whether that was because we had a GOI guarantee? thanks mcs Jane Wilson@ENRON_DEVELOPMENT 27/11/2000 06:48 To: Steven J Kean/NA/Enron@Enron, Mark Schroeder@ECT, Mark Palmer@ENRON cc: Subject: URGENT. Good morning to MSEB problems. Here we go. There are numerous press reports of a statement by Chief Minister Deshmukh. Here are a few quotes from The Financial Express: "Bowing to burgeoning pressure from its allies, the Democratic Front (DF) government in Maharashtra, in principle, has agreed to review the second phase of the 2,184-m Dabhol power project and its sale of power to the loss-making Maharashtra State Electricity Board (MSEB). Simultaneously, the state government has also agreed to look into the possibility of scrapping the revised power purchase agreement signed by the previous Shiv Sena-BJP government on December 9, 1998, with the Dabhol Power Company (DPC). Talking to newspaerson on the eve of the winter session of the state legislature, which starts on Monday at Nagpur, Chief Minister Vilasrao Deshmukh confirmed this and added that the project, which was envisaged to tackle the power shortage of the stat, seemed to have defeated its purpose because of its prohibitive costs which the consumer may have to bear. The constituents of the DF government, comprising the Peasants and Workers Party, Janata Dal (Secular( and the Communist Party of Inida (Marxist) have been pressing for the cancellation of the Dabhol project on the grounds that it would impose further financial burden on the ailing MSEB and ultimately on the state government, which is also reeling under severe financial crunch. These allies were of the view that the scrapping of the PPA will not be a major issue as such agreements with multinationals have been scrapped in Pakistan, Turkistan and Indonesia. . . . ." The team is assembling tomorrow morning at 9:00 at DPC to talk strategy. Attached is talking points I wrote up after working with Mohan Gurunath of DPC and Ananda Mukerji (EIPL -- Finance) and Jimmy Mogal (PR). I sent around for others to add their input. Query whether the CM's statement is actionable repudiation. Paul Kraske (attorney for DPC) is looking into it. ---------------------- Forwarded by Jane Wilson/ENRON_DEVELOPMENT on 11/27/2000 12:10 PM --------------------------- Jimmy Mogal 11/26/2000 08:45 PM To: Sanjay Bhatnagar/ENRON_DEVELOPMENT@ENRON_DEVELOPMENT, Wade Cline/ENRON_DEVELOPMENT@ENRON_DEVELOPMENT cc: (bcc: Jane Wilson/ENRON_DEVELOPMENT) Subject: Mah CM says Phase II under review This piece has just appeared as "breaking news" on Cafe Mumbai dot Com, on the net. Could not see it elsewhere thus far: Understand the CM is in Nagpur at the assembly session there Headline: "Enron phase-II: Mah Govt now has second thoughts ! By Abhay Deshpande Nagpur, Nov 26: Maharashtra chief minister Vilasrao Deshmukh today announced that his government would do a re-think on implementation of the second phase of the Enron power project in Maharashtra. Addressing reporters here on the eve of the start of the winter session of the state legislature, Deshmukh said under today's condition, each unit of electricity was costing the consumer almost Rs. 7/- . The rate of electricity produced also depended on the dollar-rupee ratio so also the international prices of NAPTA. As such, there were chances that the rate of electricity could go up to as much as Rs. 20/- per unit. This would prove to be very exorbitant for the consumer in the state. The CM has now asked MSEB to go into the details of the agreement between the state government and Enron. He also indicated that his government was preparing the legal grounds in case Enron took it to court if the agreement for the second phase was finally scraped. -cafemumbai Report
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