R-Infra announces its exit from Worli-Haji Ali sea-link project

Reliance Infrastructure Ltd (R-Infra) Chairman Anil Ambani has formally announced the company’s exit from the Rs 5,100-crore Worli-Haji Ali sea-link project. Ambani made the announcement at the company’s annual general meeting held here on Tuesday.

R-Infra will not get the Rs 150 crore it spent on the preparation of the project. However, the state-run Maharashtra State Road Develo-pment Corp (MSRDC) will refund Rs 100 crore to R-Infra towards the bank guarantee money it paid at the time of filing the bid.

Ambani’s announcement comes at a time when MSRDC's board of directors at an August 9 meeting had referred the project to the state infrastructure committee for taking a final call. After the committee gives its nod for scrapping the contract, MSRDC will explore the securitisation option to complete the project and appoint a consultant to carry out a study in this regard, an MSRDC official told Business Standard.

The project seeks to link Worli to Haji Ali in Mumbai over sea.

“We have conducted an in-house study, but it needs to be vetted by a consultant. After receiving the state infrastructure committee’s report, it will take two months to complete consultant’s report and then (we will) proceed,” the MSRDC official, who did not want to be named, said. The official said MSRDC would not complete the project on the build-operate-transfer model.

The project has been in news after MSRDC and Reliance Sea Link One Pvt Ltd, the special purpose vehicle formed to execute the project, signed the concession agreement in June 2010. However, the actual construction did not begin as the company was engaged in dispute with MSRDC over amendments to the state support agreement, change in clause relating to the viability gap funding of Rs 1,392 crore and providing space for casting yard.