Korean power giant KOSEP has emerged as a wildcard in the stalled $1.2 billion sale of the Bluewaters power station after revelations it is backing an attempt by former coal tycoon Ric Stowe to retake the plant.
Both KOSEP, which is a subsidiary of Korea's biggest electricity generator KEPCO, and Mr Stowe declined to comment.
However, a source close to Government confirmed a tentative deal was being floated.
The deal would entail KOSEP recapitalising the assumed debt within Bluewaters.
"I know he (Stowe) has a fair bit of money behind him , so he actually has more capacity right now than other players in the field," the source said.
"The power stations have always been the best part of the business by a country mile.
"The power price they are getting paid is actually quite reasonable."
Yet KOSEP and Mr Stowe face significant hurdles in getting the administrator to consider their late bid in the sale process, which has dragged on for 15 months.
Administrator KordaMentha declined to comment.
In 2010 Mr Stowe lost control of his debt-laden empire, which included the Bluewaters station that produces up to 10 per cent of the South West's power supply.
KordaMentha has stalled in its attempts to sell Bluewaters to Japanese firms Sumitomo and Kansai Electric.
The sale has been complicated by a stalemate between Bluewaters and its Collie coal supplier Griffin Coal, which is now owned by debt-laden Indian firm Lanco Infratech.
State-owned utilities Synergy and Water Corporation have been asked to pay up to $60 million more for the power they get from Bluewaters so it in turn can pay more for the coal it gets from Griffin to secure its coal supply.
The delay is frustrating the Government but Premier Colin Barnett has warned Synergy and Water Corp not to pay more for power.
That uncertainty would remain for Mr Stowe, but with the backing of the Koreans he may be able to offer a deal without requiring higher power prices.
Sources close to the administrator are said to view Mr Stowe's ongoing separate legal actions against Lanco as a blocking tactic to extract money, as administrators are in turn in a separate tax dispute with Mr Stowe.