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Tuesday, 4 December, 2001, 15:48 GMT
Buyers pick over Enron's Indian plant
Shell truck at petrol station
The Anglo-Dutch energy giant now has its sights on India
Anglo Dutch energy giant Royal Dutch Shell has emerged as a possible buyer for Enron's liquefied natural gas (LNG) terminal in India.

The $2.9bn LNG terminal is one part of the Dabhol power company, 65% owned by Enron, and the first of its kind in South Asia.

Enron - which has filed for bankruptcy - is thought to be reluctant to sell its stake in the power plant piecemeal, but low offers may prompt it to change its mind.

The Gas Authority of India and BG Group are also thought to be interested in the LNG terminal, while Tata and Reliance Industries' BSES are interested in the whole power project.

The liquefaction process is often used to transport natural gas where there are no pipelines.

The future is LNG?

"LNG is the fuel of the future. We believe there is a sizeable market for LNG in India," a Royal Dutch Shell spokesman said.

"Our current proposal is for the LNG plant. It does not mean we could not consider the power project in the future if offered," he added.

Enron has long made clear its intention to exit the project.

Enron's Indian operations have already been hit by a local dispute over its charges for power.

Dabhol owes billions of dollars to Indian banks, who - if a buyer can not be found quickly - could be badly hurt.

The project - originally hailed as the largest foreign investment in India - ran into trouble nearly two years ago when the Indian authorities delayed payments because they said Enron's charges were too high.

The BBC's Sanjeev Srivastava
"Enron is maintaining that they are not selling it in bits and parts"
See also:

01 Nov 01 | Business
Weak oil prices injure Shell
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