July 12, 2005
Bechtel and the governments of India and Maharashtra today reached a settlement regarding the Dabhol power project.
Statement by Bechtel on Dabhol Settlement
In exchange for $160 million in compensation for its equity and contractor claims, Bechtel agreed to forgo international arbitration over the expropriation of its investment. A portion of this financial settlement was subject to Indian taxation.
Bechtel took steps to convey its original 10 percent interest in Dabhol Power Company (DPC) to Newage Power Company Private Ltd., an Indian entity.
Bechtel and the relevant Indian parties agreed to cooperate to terminate all other legal actions in the Dabhol case. These include contempt citations against Maharashtra Power Development Corporation, Ltd. (MPDCL) and against a Bechtel affiliate and several directors. Bechtel will also lift its orders to attach MPDCL's shares in DPC and other assets.
Bechtel is very grateful that high-level representatives of the Indian government played a particularly constructive role in facilitating this agreement, allowing the Dabhol project to help meet the critical energy needs of Maharashtra's growing economy.
Finally, Bechtel is fully prepared to assist in the restart and completion of the facility. We will provide all our design drawings and construction records and make our team available should the new owners request such help.