ENRON & ISPAT SIGN GAS SALES AGREEMENT
FOR IMMEDIATE RELEASE: Friday, March 24, 2000
Mumbai --- Enron Energy Marketing Services, a wholly-owned subsidiary of Enron Corp., and Ispat Energy Ltd., a subsidiary of Ispat Industries Ltd., today announced the signing of a gas sales agreement (GSA) whereby Enron will supply natural gas to Ispat Energy’s captive power plant currently under development in Dolvi, Maharashtra.
Under the terms of the GSA, Enron will supply 0.2 million tons per annum of LNG over a 20-year period to Ispat Energy. Gas deliveries are expected to commence in third quarter 2002. Gas will be transported from the LNG-processing terminal at Dabhol via pipeline to Ispat’s plant in Dolvi. Metropolis Gas Pvt. Ltd., a wholly owned subsidiary of Enron, currently is developing the pipeline.
"We are very pleased to be able to bring a guaranteed source of environmentally-friendly fuel to Dolvi. This signing is an important milestone in our gas marketing efforts," said Sanjay Bhatnagar, CEO of Enron India Ltd.
Earlier in the week, Enron and Ispat Energy also reached agreement on terms regarding Enron’s purchase of approximately 49 percent equity in Ispat Energy Ltd. Financial close for the Dolvi power plant is expected in the second quarter of 2000.
"Enron’s global experience will benefit the Ispat Group and help achieve higher operational efficiency. The strategic alliance with Enron is expected to enhance shareholders value", said Mr. VK Mittal, joint managing director of Ispat Industries Ltd.
Ispat Energy’s Dolvi power plant has a planned capacity of approximately 354 megawatts and is being developed as a captive power plant for an integrated steel plant of Ispat Industries Ltd. and Ispat Metallics India Limited at Dolvi, Dist – Raigad, Maharashtra.
Enron is one of the world’s leading electricity, natural gas and communications companies. The company, which owns approximately $34 billion in energy and communications assets, produces electricity and natural gas, develops, constructs and operates energy facilities worldwide, delivers physical commodities and financial and risk management services to customers around the world, and is developing an intelligent network platform to facilitate online business. Enron’s Internet address is www.enron.com, and the stock is traded under the ticker symbol, "ENE."
Ispat Industries Ltd. (IIL) is the flagship company of the $2 billion asset Ispat Group. Incorporated in 1984-85, Ispat Industries is a pioneer in the steel industry. In 1994, IIL commissioned the world’s largest gas-based single module plant for making Direct Reduced Iron (DRI) commonly known as Sponge Iron. It also took the first step towards creating a mega steel complex comprising of Sponge Iron (1.2 million tons, now being expanded to 1.8 million tons), Hot Rolled Coil (3 mtpa), Blast Furnace project (2 mtpa) and a 354 megawatt captive power plant at Dolvi, Maharashtra. IIL has already commissioned the first phase (1.5 million tons) of its three million tons per annum Hot Rolled Coil Steel Facility, becoming the world’s first steel unit to combine the Thin Slab Casting technology and the Conarc process of steel making and producing the finest Hot Rolled Steel Coils. The second phase is currently under implementation in order to produce a total of 3 million tons of Hot Rolled Coils. With the commissioning of the Blast Furnace, which is expected in a few days, and implementation of the captive power plant, ISPAT would be one of the cheapest producers of Hot Rolled Steel Coils with finest quality.
Apart from steel, Ispat has a strong presence in power and telecommunications. Ispat Industries Ltd. is a promoter of Hughes Ispat Ltd. and Ispat Metallics India Ltd.
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For additional information please contact:
ENRON
International: Kelly Kimberly,
1-713-646-6416
India: Vrinda Walavalkar
022-283-5835
ISPAT
Gautam Chakravorthy
Tel: 022-2855517/18
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