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May 8, 2001
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Govt seeks legal view in DPC row

Renni Abraham

The Maharashtra government is pursuing all legal angles related to the Dabhol Power Company in the wake of the power utility's reported reservations on the terms of reference of the freshly constituted committee for renegotiating the power purchase agreement.

A senior government official said: "Too much should not be read into the DPC statements. It is best to wait for the meeting with the Godbole committee on Friday where the company would state its position with regard to reservations about the committee or its terms of reference. It would be premature to assume their reservations are non-remedial."

It is reliably learnt that DPC would be represented by Enron India president Wade Kline and Dabhol Power company CEO Neil McGregor and some other lenders and shareholders. Also expected to be present at the May 11 meeting are DPC's legal counsel with expert in contract law.

However, the government is leaving little to chance and has put its legal department on the job to bolster its case if the Enron promoted utility tries to pull the rug from under its feet.

"We are not certain about DPC's gambit and are keeping all our options open. During the chief minister's meeting with Union Power Minister Suresh Prabhu we suggested the option of serving the termination notice ourselves, which was, however, rejected by the Centre," a government official said.

"We stand a good chance in court even if arbitration proceedings are initiated by DPC since, unlike in 1995, this time the power major has also committed defaults by being unavailable to MSEB within three hours as stipulated in the PPA," he added.

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