Dabhol contractors threaten legal action against RGPPL

29 March 2007

Mumbai: The beleaguered Dabhol power project in Maharashtra hit another bump with the contractors for the LNG terminal, Punj Lloyd and its British partner Whessoe threatening legal action against Ratnagiri Gas and Power Pvt Ltd (RGPPL) for default on payments.

The 50:50 Punj Lloyd-Whessoe joint venture sent a notice of default on March 16 to RGPPL, the owner of the 2,150 MW power plant and its ongoing five million tonnes LNG terminal project, for clearing all payments due for work already completed.

The joint venture was awarded a Rs500 crore contract for completing the jetty facilities in June last year with a target date of July 2007 for completion. Besides, Rs51 crore of dredging work and Rs15 crore of marine work was also awarded.

RGPPL has so far made payments of only Rs68 crore against Rs317 crore worth of work executed on LNG jetty and dredging. "Bills worth Rs265 crore are pending with RGPPL," sources pointed out.

The joint venture has threatened to take legal action against RGPPL in Singapore and remove its equipments from the site if the payments are not made by April 2, official sources said.

RGPPL, a joint venture of NTPC, Gail, IDBI-led lenders and the Maharashtra State Electricity Board, took over the Dabhol project in 2005.