CEBEU protest against underhand move to go ahead with unsolicited proposal from US Energy Firm

By Ifham Nizam

The Ceylon Electricity Board Engineers yesterday strongly opposed what they called a government decision to contract US Energy Firm New Fortress Energy to supply LNG and put in place infrastructure.

CEBEU President Saumya Kumarawadu told The Island yesterday they would not support the move, claiming it would lead to financial frauds.

“This deal will lead to losses running to billions of rupees to the country and finally the US firm will acquire rights to supply LNG to all the existing and future power plants, and this is of concern to us,” he said.

The CEBEU President said the CEB had already initiated a transparent competitive bidding process, which was ongoing following the completion of a comprehensive feasibility study, to procure LNG infrastructure to supply LNG for all the existing and future power plants in the country and it was in the final stage.

“I think that to sign an agreement in the middle of a tender process is extremely upsetting,” Kumarawadu added.

Engineers said an ad hoc ‘Technical Committee’ had been appointed by the Ministry of Finance to negotiate terms of the existing Power Purchase Agreement (PPA) between CEB &West Coast Power (Pvt.) Ltd (WCPL) and an unsolicited proposal to supply LNG to West Coast Power Plant (WCPP)by New Fotress Energy(NFE).

“We were shocked to know this unwarranted move and would like to highlight the following vital concerns in this regard,” they pointed out.

The Ministry of Power and the CEB have already initiated a competitive bidding process to procure LNG for all the existing and future power plants around Colombo including the WCPP and it’s in the final stage. “Hence, as we have already communicated to Hon. Minister of Power by our letter dated 26 April 2021, that any unsolicited procurement which might badly affect the ongoing bidding process should not be encouraged.”

One of the main objectives of this committee is said to be negotiating terms of the existing PPA between the CEB & WCPL. The CEBEU has said “The PPA contains very sensitive parameters which finally account for payments running into billions of rupees. Hence, any amendments to this PPA (if required) should be made very carefully, as per the procurement rules and regulations of the country. The Chief Financial Officer of the ministry is responsible for ensuring such sound procedures are duly practiced in this process.”

The composition of the so-called ‘Technical Committee’ is also very strange; they pointed out adding, “We have doubts that this committee has been appointed with a predetermined outcome in mind,” CEBEU said.

The Union also said the Secretary, Ministry of Power should seriously consider all the implications of the move and take remedial action.