The deals enable NTPC to increase its stake in Ratnagiri Gas and Power and exit from the Dabhol LNG business

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The deal will increase NTPC's stake in Ratnagiri Gas and Power to 86.49%. (Credit: Tumisu from Pixabay)

NTPC has executed share purchase agreements with GAIL (India) pertaining to power generating firm Ratnagiri Gas and Power and LNG operator Konkan LNG.

As per the terms of the first agreement, NTPC will acquire GAIL’s stake of 25.51% in Ratnagiri Gas and Power, the owner and operator of the 1.96GW Dabhol power station in Maharashtra, India.

The company did not disclose the financial terms of the transaction.

However, the deal will increase its stake in Ratnagiri Gas and Power to 86.49%.

Ratnagiri Gas and Power was established in 2005 to takeover and revive the assets of the defunct Dabhol Power Company Project.

Originally, GAIL and NTPC each had stakes of 25.51% in Ratnagiri Gas and Power, while the remaining stake has been held by the Maharashtra State Electricity Board and financial institutions.

The Dabhol power station comprises three gas-fired units of 640MW, 663.5MW, and 663.5MW capacities.

The other deal will see the exit of NTPC from Konkan LNG following the sale of its 14.82% stake to GAIL (India) for an undisclosed price.

Konkan LNG was created by GAIL following a demerger from Ratnagiri Gas and Power. The company owns an LNG terminal in Dabhol in the Ratnagiri district of Maharashtra, which has a capacity of five million metric tonnes per annum (Mmtpa).

The Dabhol LNG terminal comprises a regasification plant, an unloading jetty for LNG carriers, and a 2.3km long offshore breakwater.

In March last year, NTPC signed agreements to acquire stakes in North Eastern Electric Power Corporation (NEEPCO) and THDC India from the Indian government for a combined sum of INR115bn ($1.53bn).