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5 July 2005 - US Bechtel Corporation, the majority stakeholder in the Dabhol Power Company, is reportedly looking to settle claims from the controversial power project in Mumbai within the week. This follows the decision by fellow-investor General Electric (GE) to agree a settlement in the 2184 MW project.
A group of domestic investors are seeking to restart the $2.9 bn power and gas facility, built by bankrupt energy trader Enron, which stalled following a dispute over power payments between Enron and the Maharashtra State Electricity Board. The group say they hope for a resolution to Bechtel's attempts to regain its investment following the announcement of a deal by General Electric that it had settled its own Dabhol claims.
GE said at the weekend it had achieved a "comprehensive and equitable" conclusion of its claims against Indian parties, including the central and regional governments. According to people familiar with the negotiations, GE had settled for a payment of about $150m, though the US conglomerate did not mention a sum in its statement.
Bechtel is due to take part in arbitration proceedings in London into allegations of 'expropriation' against the Indian government. This comes at a time when India is seeking to attract new foreign investors to participate in its expanding economy. If a settlement was achieved with Bechtel, the potentially embarrassing arbitration proceedings need not proceed.
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