Enron corporation's power project in India Essay

Enron corporations power project in India - Essay ExampleEnron entered into a contract with the Maharashtra Sate electrical energy Board (MSEB) by risking its and its allied companies stakes in Dabhol Power Project (DPP). The discussions for the project started with the two promontory stakeholders from the Indian side, the Indian state of Maharashtra and the other was Maharashtra State Electricity Board (MSEB). The project proposal of mental synthesis a 2015 megawatt power plant with the investiture of US$3 historyion was given a jet-propelled plane signal initially (Negotiation-project-India, 2010). Enron was not the only principal stakeholder it was a sort of joint collaboration with the investment of 10% each by General Electric and Bechtel. Sustenance of the project was detriment to the availability of liquified Natural Gas to power the plant, which Enron planned to secure from one of its joint venture in Qatar, 1200 miles past from the power plant situated in Dabhol. The project was the largest ever project taken by Enron in India, supposed to bring about electricity in two phases. In the first phase it was planned to resurrect 695 megawatts from the locally available LNG, while the second phase target was to produce 1320 megawatts through natural bluster channeled from Qatar (Negotiation-project-India, 2010).Enron was expecting extensive profits from this project for the company investors from the MSEB of Maharashtra. It took just five days to materialize the contract by signing a memorandum of agreement between the MSEB and DPP. (Negotiation-project-India, 2010).... Sustenance of the project was detriment to the availability of change state Natural Gas to power the plant, which Enron planned to secure from one of its joint venture in Qatar, 1200 miles out from the power plant situated in Dabhol. The project was the largest ever project taken by Enron in India, supposed to produce electricity in two phases. In the first phase it was planned t o produce 695 megawatts from the locally available LNG, while the second phase target was to produce 1320 megawatts through natural turgidness channeled from Qatar (Negotiation-project-India, 2010). Enron was expecting huge profits from this project for the company investors from the MSEB of Maharashtra. It took just five days to materialize the contract by signing a memorandum of agreement between the MSEB and DPP, representing Enron of purchasing electricity at the rate of 7.3 US cents per kilowatt hour (Negotiation-project-India, 2010). What went wrong that the project failed? From the very start, it was a mistake made by the anxiety at Enron to invest in a technology-efficient project in India without attempting an analysis of Indian socio-political environment. One social occasion became clear that the project was cleared without adhering to set efficacious and corporate procedures, essential for such a huge global venture. It also became evident that Enron adopted the unet hical path in securing the contract. It was totally in the injustice over the political unsettling environment in India. All its negotiating and renegotiating expertise failed as the MSEB could not pay the bill against the used electricity. Enron had to confront opposition from many fronts it had to initiate counter-campaigns to create positive conditions in its favor legal battles also ensued.