PCoI Chairman explains why LNG plant construction got delayed

By Rathindra Kuruwita

If those who were involved in the procurement process of the construction of a 300 MW LNG power plant at Kerawalapitiya had acted responsibly, the construction of the power plant would have been completed by now and a significant amount of money spent on purchasing emergency power could have been saved, Chairman of the Presidential Commission of Inquiry (PCoI) investigating corruption in the current administration, retired Supreme Court Justice Upali Abeyrathne said, yesterday, after listening to the testimony of a senior CEB official.

Lalith Ranawaka, Project Manager of the LNG power plant at Kerawalapitiya told the PCoI that the bids for the tender had been called on November 18, 2016. The technical bids of eight companies were opened on April 21, 2017 and the Technical Evaluation Committee (TEC) on its report on June 06, 2017 decided that financial bids of six companies should be opened. However, Cabinet Appointed Procurement

Committee (CAPC) decided only to open the financial bid of one Company, Samsung C & T. The bidders followed the dual envelope system, where the technical and financial bids were placed separately. Financial bids would be opened only of those who had fulfilled technical qualifications.

When questioned why the CAPC had made that decision contrary to that of the TEC, Ranawaka said that Samsung C & T was the only company that included a compressor that was needed to control the pressure of LNG pumped into the plant.

"The plant and LNG supply are two separate operations. The responsibility of supplying LNG to the plant was the responsibility of the CEB. The plant is expected to operate at 32 bars, a widely used metric unit of measurement for pressure, and if the pressure of the LNG supply is higher or lower, a compressor is needed to increase or decrease pressure to match 32 bars."

Ranawaka added that the compressor was not an expensive or highly sophisticated machine and that almost all bidders had asked the CEB, who was in charge of supplying LNG, about the pressure and heat in which they would supply LNG.

"We told them that we didn’t know because that depended on where or how we brought LNG. So the others didn’t mention a compressor."

Justice Abeyrathne said that if the 300 MW LNG power plant at Kerawalapitiya had been constructed on time, by mid-2019, Sri Lanka could have saved significant amounts of money spent on high cost emergency power. "Some parties are delaying the implementation of the long term generation plan deliberately so that they can purchase high cost emergency power. This is what we are looking at."

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