However, following the public sector steel major's tiff with its labour unions, the two existing bidders may not proceed with their due diligence unless the issue is resolved.

Enron officials told The Financial Express: "We have aborted our diligence exercise mid-way which we will resume once SAIL manages to sort out its problems with its unions."

Though Enron is not into managing coal-based power plants globally, it is believed that the US-based major will look into the possibility of converting the plants into gas-based ones if it puts in its final bid and is selected.

SAIL had shortlisted five of seven initial bidders, including three multinationals. The strategic partner, initially for a period of 15 years to operate and maintain the power plants, is expected to pick up a 49 percent stake.

SAIL will buy the power from the new company at a rate of Rs 1.32 or Rs 1.40 per unit, higher than the present cost of Rs 1.20 per unit. This, SAIL officials said, will be due to some additional investment that will be required to be put in following the hive-off. It will be used for modernisation of the existing plants.

The decision to hive off the power plants at Bokaro, Rourkela and Durgapur is part of SAIL's plan to get out of all non-core activities. The hive off is expected to fetch the company around Rs 700-750 crore.6

They said the company was looking into the crucial labour issue and expected the matter to get resolved shortly. Following the company's announcement of hiving off the three power plants, its unions, representing the 1,500-and-odd employees at the power plants, have been up in arms over the decision and have refused to work for the joint venture.

SAIL officials added that the employees at the power plants will be given the option of continuing with the new jointventure or, if they refuse, will be deployed in another division of SAIL.