From The Enron India Newsdesk - Nov 21st Newsclips ,
 THE TIMES OF INDIA, Wednesday, November 21, 2001
DPC sponsors meet next week for due diligence talks=20

Similar story also appeared in the following publications:

THE HINDU BUSINESS LINE, Wednesday, November 21, 2001
DPC sponsors to meet next week

THE FREE PRESS JOURNAL, Wednesday, November 21, 2001
DPC sponsors meet in US next week to discuss due diligence
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THE ECONOMIC TIMES, Wednesday, November 21, 2001
BSES inches forward in DPC race=20
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THE HINDUSTAN TIMES, Wednesday, November 21, 2001
Enron in talks to sell off data centre, Arun Kumar=20
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THE ECONOMIC TIMES, Wednesday, November 21, 2001
Enron restates Q3 earnings=20
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THE FINANCIAL EXPRESS, Wednesday, November 21, 2001
Maharashtra govt objects MSEB's 19% tariff hike, Sanjay Jog=20
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THE FINANCIAL EXPRESS, Wednesday, November 21, 2001
State opposes MSEB proposal on 19 per cent power tariff hike, Sanjay Jog=20
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THE TIMES OF INDIA, Wednesday, November 21, 2001
DPC sponsors meet next week for due diligence talks=20
Senior officials of energy major Enron Corp, Bechtel and GE, the three fore=
ign sponsors of the troubled Dabhol Power Company (DPC), will meet in Houst=
on next week to take a decision on whether to proceed with the proposal of =
due diligence to be carried out by city-based power utilities, the Tata Pow=
er Company and BSES Ltd. "The offshore sponsors of DPC have not yet given t=
heir go-ahead for potential buyers of their 85 per cent equity to commence =
due diligence. They are scheduled to meet before this month end to decide t=
heir next step regarding Dabhol project," sources close to the sponsors sai=
d here on Tuesday. When contacted, DPC spokesperson declined to confirm or =
deny the development. Sources said that the sponsors' decision would be con=
veyed to the Industrial Development Bank of India-led consortium of Indian =
lenders by first week of December. "Contradictory to recent announcements b=
y Indian lenders, and the prospective buyers, the ability of any party to s=
ign the confidentiality agreement and proceed with due diligence will after=
 all depend on the three foreign sponsors' approval," they pointed out.
Both Tatas and BSES would need their approval and co-operation to commence =
due diligence, sources emphasised. Tata Power managing director Adi Enginee=
r confirmed that they were yet to commence DPC due diligence. "We are waiti=
ng to sign the confidentiality agreement with DPC sponsors after which Tata=
 Power would take at least a few months to complete the process," Engineer =
said. Sources termed the meet as critical in deciding the future course of =
events in resolving the issues surrounding the $3 billion power project. "E=
nron, GE and Bechtel had raised the issue of continuing costs of fundings d=
uring the three-day marathon Singapore meet, risen as a result of the India=
n and foreign lenders' refusal to disburse additional funds," they informed=
.
The proposed due-diligence was expected to take another two-three months, s=
ources said, adding the situation had become more fragile with the Maharash=
tra State Electricity Board not drawing power since May 29 and lenders stop=
ping disbursements to the 2,814 mw project March onwards. "This has resulte=
d in the beleagured DPC also being unable to meet its loan repayment commit=
ments in September and October," they added. During the Singapore meet, the=
 three foreign sponsors had also expressed their grave concern about bearin=
g additional expenses as the due diligence process would take its own time =
and incur significant costs, only adding to deterioration of assets and the=
ir cost burden, the sources said. On Monday, BSES Ltd chairman and managing=
 director R.V. Shahi had announced that the company was likely to complete =
the due diligence of the Dabhol project by January end next year. Shahi sai=
d that BSES had returned the draft of confidentiality agreement with commen=
ts to DPC. BSES would appoint three separate consultants for doing technica=
l, financial and legal due diligence along with an internal task force to d=
o parallel ground work, he said.( PTI )
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THE ECONOMIC TIMES, Wednesday, November 21, 2001
BSES inches forward in DPC race=20

BSES has inched a step forward in the race to acquire Enron's stake in Dabh=
ol Power Company. The company, which is one of the bidders for Enron's stak=
e has approached the heads of financial institutions for funding of the pro=
ject after the change in ownership. Irrespective of who the new stake-holde=
r is, they would need the Fis to lend to them to see the completion of the =
project. The heads of institutions are at present considering the BSES requ=
est though a view is yet to be taken on the issue. BSES apart, Tata Power i=
s the other serious contender for the project.

The Fis have been sounding out the both BSES and Tata Power as the governme=
nt feels that buying out the plant could be good proposition if some of the=
 tariff issues are sorted out. R V Shahi, chairman-cum-managing director of=
 BSES said after his meeting Singapore last week that talks were progressin=
g and the company would soon get on with the next stage. BSES, is likely to=
 complete due diligence of the 2,184 MW Dabhol Power project by January end=
 next year. "The due diligence process will take 6-8 weeks after signing of=
 the confidentiality agreement with Enron promoted DPC," BSES CMD R V Shahi=
 told reporters here. Shahi said BSES has returned the draft of confidentia=
lity agreement with comments to DPC. The confidentiality agreement, a pre-r=
equisite for beginning due diligence of DPC to assess the value of its asse=
ts, investments needed to complete the 1,444 MW Phase-II and its liabilitie=
s, would in all probability be signed by the end of this month.BSES would a=
ppoint three separate consultants for doing technical, financial and legal =
due diligence of the 2.9 billion dollar project, he said, adding that simul=
taneously an internal task force would also be appointed to do parallel gro=
und work. Shahi said the company has shown interest in acquiring 85 per cen=
t stake of Enron, Bechtel and GE in the Dabhol project at the recently conc=
luded Singapore meeting convened by FIs. After signing the confidentiality =
agreement BSES will formally look into the financial books of DPC, its loan=
s, sponsors and other assets and legal wrangles before taking any decision =
on the acquisition price.
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THE HINDUSTAN TIMES, Wednesday, November 21, 2001
Enron in talks to sell off data centre, Arun Kumar=20

Beleaguered energy major Enron is said to be in negotiations with at least =
two prospective Indian buyers for selling its $18 million Internet Data Cen=
tre (IDC) located at Mumbai. This is the second Indian investment that Enro=
n is looking to exit from. It is already in the midst of a possible selloff=
 of its stake in the controversial Dabhol Power Co. When contacted, an Enro=
n India spokesperson said "as part of our policy we do not discuss this iss=
ue with the media. As you are aware such issues are part of our global stra=
tegy, but we are not desperate to sell".=20

However sources maintained that the company was talking to at least two bid=
ders, one being a leading Mumbai real estate firm, and that talks were curr=
ently hedged on pricing issues. The reason for the selloff move is part of =
Enron's decision to exit from India, the sources added. The move is also be=
ing fuelled by the recent $9.5 billion acquisition of Enron by Dynegy Inc. =
According to the sources, Enron may sell IDC at below cost. It had invested=
 over $18 million (over Rs 90 crore) to develop the 30,000 sq. ft. data cen=
ter, which caters to a host of new economy firms, including Hungama.com and=
 Gateway System. The sources added Enron had considered roping in a strateg=
ic equity partner for IDC and, since that did not happen, "it has now decid=
ed to exit from this business".=20

Enron India had announced grand plans for setting up a nationwide fiber opt=
ic cable backbone to tap rising demand for bandwidth. After the company aba=
ndoned this plan, speculation was rife that it would divest its data center=
 sooner or later. Analysts said the center is a standalone business globall=
y and Enron was left with no option but to take bandwidth on lease from oth=
ers. This increased the project cost, they observed. The company had origin=
ally planned to set up five more data centers in Bangalore, Delhi, Chennai,=
 Hyderabad and Ahmedabad.=20
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THE ECONOMIC TIMES, Wednesday, November 21, 2001
Enron restates Q3 earnings=20

S embattled Enron examines its books, the energy trader restated its third-=
quarter earnings, increasing its loss for the period by 3 cents a share to =
87 cents. The company also disclosed it is trying to restructure a $690-mil=
lion obligation that could come due November 27. Enron spokesman Mark Palme=
r said the company has the cash on hand to pay the obligation but would lik=
e to have it restructured and extended. "We are working with the lenders to=
 restructure or extend the term on the obligation," he said. Palmer said th=
e obligation could come due because of Enron's lowered credit rating. When =
the rating was reduced, it triggered a clause in one of the "limited partne=
rship agreements that could cause that $690 million obligation to become du=
e beginning next week."=20

Houston-based Enron, which is being purchased by rival Dynegy to escape a r=
ecent spate of problems and shattered Wall Street confidence, also increase=
d nine-month earnings by a cent to 20 cents a share. Dynegy is purchasing t=
he company for $7.8 billion in stock. In a filing with the Securities and E=
xchange Commission on Monday, Enron explained that auditor Arthur Andersen =
LLP hasn't finalised its review of the company's financial statements becau=
se of an ongoing investigation by a special committee appointed by Enron's =
board of directors. "We are continuing to review the transactions in questi=
on and are making progress with our investigation," said William K Powers J=
r., chairman of the special committee and dean of the University of Texas S=
chool of Law. The merger is expected to go through by next summer. Dynegy, =
backed by major investor ChevronTexaco, will also assume $13 billion of Enr=
on debt. Enron agreed to be bought after its stock price plunged about 80 p=
er cent in the weeks after it disclosed a third quarter loss followed by an=
 acknowledgment that the Securities and Exchange Commission was investigati=
ng partnerships run by company officials. (AP)
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THE FINANCIAL EXPRESS, Wednesday, November 21, 2001
Maharashtra govt objects MSEB's 19% tariff hike, Sanjay Jog=20

Bowing to the pressure from an influential powerloom and agricultural lobby=
 along with various consumer organisations, the state government has strong=
ly opposed the Maharashtra State Electricity Board's (MSEB) 19 per cent tar=
iff hike suggested for 2001-02 to the Maharashtra Electricity Regulatory Co=
mmission (Merc). The state government, in its affidavit before the Merc has=
 made it clear that the tariff hike proposed by the state electricity board=
 was on \"higher side in respect of domestic, agricultural, powerloom and p=
ublic works consumers."

According to the government affidavit, the tariff hike for the domestic con=
sumer for the slab of 0-30 units would comprise Rs 20 as fixed charge per m=
onth and 75 paise per unit as energy charge instead of MSEB's proposal of R=
s 75 per month fixed charge. For non-domestic consumers, the government has=
 proposed a fixed charge of Rs 100 per month and energy charge of Rs 2.50 p=
er unit for 0-100 units. Although the government has proposed a fixed charg=
e of Rs 100 per month for 101-200 units and 201-above units like the MSEB, =
it has suggested an energy charge of Rs 4.60 and Rs 6 as energy charge for =
101-200 units and 201-above units respectively. For powerlooms, the fixed c=
harge would be Rs 75 per horse power per month instead of MSEB's proposal o=
f Rs 100 per kw per month. However, it has suggested different energy charg=
es against MSEB's proposal of a similar energy charge of Rs 2 per unit. For=
 agricultural consumers, the flat rate tariff would be Rs 100 per horse pow=
er per month instead of MSEB's proposal of Rs 300 per KW per month for load=
 between 0-5 horse power. The state government has admitted that there was =
a difference of opinion between it and the state electricity board with reg=
ard to the proposed tariff increase.=20
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THE FINANCIAL EXPRESS, Wednesday, November 21, 2001
State opposes MSEB proposal on 19 per cent power tariff hike, Sanjay Jog=20

Bowing to the pressure from an influential powerloom and agricultural lobby=
 along with various consumer organisations, the state government has strong=
ly opposed the Maharashtra State Electricity Board's (MSEB) 19 per cent tar=
iff hike suggested for 2001-02 to the Maharashtra Electricity Regulatory Co=
mmission (Merc). The state government, in its affidavit before the Merc has=
 made it clear that the tariff hike proposed by the state electricity board=
 was on "higher side in respect of domestic, agricultural, powerloom and pu=
blic works consumers." According to the government affidavit, the tariff hi=
ke for the domestic consumer for the slab of 0-30 units would comprise Rs 2=
0 as fixed charge per month and 75 paise per unit as energy charge instead =
of MSEB's proposal of Rs 75 per month fixed charge. For non-domestic consum=
ers, the government has proposed a fixed charge of Rs 100 per month and ene=
rgy charge of Rs 2.50 per unit for 0-100 units.=20

Although the government has proposed a fixed charge of Rs 100 per month for=
 101-200 units and 201-above units like the MSEB, it has suggested an energ=
y charge of Rs 4.60 and Rs 6 as energy charge for 101-200 units and 201-abo=
ve units respectively. For powerlooms, the fixed charge would be Rs 75 per =
horse power per month instead of MSEB's proposal of Rs 100 per kw per month=
. However, it has suggested different energy charges against MSEB's proposa=
l of a similar energy charge of Rs 2 per unit. For agricultural consumers, =
the flat rate tariff would be Rs 100 per horse power per month instead of M=
SEB's proposal of Rs 300 per KW per month for load between 0-5 horse power.=
 The government has admitted that there was a difference of opinion between=
 it and the MSEB with regard to the proposed tariff increase. "As such, it =
is necessary that MSEB and state government come to an agreement in this re=
gard for which the Commission may take appropriate steps," the government s=
aid. "The government of Maharashtra has taken note of apprehensions express=
ed by public representatives and has come to the conclusion that the propos=
ed tariff in respect of certain categories of consumers, as mentioned above=
, is indeed on the higher side."
nikita.varma@enron.com