Mumbai: French oil and gas major TotalFina is believed to have initiated talks with Tata Power and Gail to form a consortium to bid for the 85-per cent stake of the foreign stakeholders in Dabhol Power Company (DPC).
Tata Power and Gail have already announced their plans to bid for DPC and the talks are on for placing a joint-bid proposal with the DPC lenders. Sources close to this development said TotalFina will resume first-round talks with Tata and Gail by the end of this week. The company, it is learnt, is more interested in taking over the million-tonne LNG facility, instead of the power plant.
TotalFina had earlier joined hands with Tata Power and Gail to set up an LNG terminal at Trombay, Mumbai, and had incorporated a company called Indigas. But, due to the project not being viable in the Trombay region, the promoters scrapped the project about four month ago.
The lenders had earlier clearly stated that DPC will not be split and the entire 85 per cent foreign equity will be sold as a single bloc and the interested parties may together put in joint bids. Senior financial institutional sources said Tata Power and BSES are more interested in managing the power plant while other bidders like Gail, Shell, TotalFina and Gaz de France have set their eyes on Dabhol's LNG facility.
GDF, the other France-based oil company, has already picked up a 10-per cent stake in Petronet LNG in Gujarat. Gaz de France's president Pierre Gadonneix, during his first visit to India in 2000, had said the company has plans for heavy investments in India's oil and gas sector.
Currently, there are at least six companies that have shown interest in picking up equity in DPC. Four companies - Tata Power, Gail, BSES and Shell - have already made public their plans to buy the promoters' stake in the power project, while Videocon, TotalFina and GDF have still not disclosed there plans about DPC.
The FI officials said under these circumstances, consortium bidding is the viable solution to solve the DPC crisis at the earliest. "We will issue guidelines to DPC bidders before the end of this month." Says an SBI Caps analyst: "With more bidders joining the race to pick up equity in DPC, the coming months would see formation of new consortiums to bid for the 2,184-mw mega power-cum-LNG plant."
He thinks NTPC's close association with BSES in other projects will emerge as a critical factor for DPC-bidding. While forming the consortium, BSES and NTPC may rope in either Shell or GDF, as Videocon seems to have remained silent after its first round of talks with the institutions and the Maharashtra state government.