News

Energy experts complain of cheap feasibility study on expensive LNG facility

Published

2 years ago

2021/03/1

By Rathindra Kuruwita

Only USD 45,000 has been spent on a feasibility study for deploying a floating storage and regasification unit (FSRU) and a mooring system for liquefied natural gas (LNG) although Sri Lanka will spend about USD 4 billion annually for the infrastructure and the purchasing of LNG, energy experts claim.

They said that the feasibility study, commissioned by the Asian Development Bank (ADB), had been carried out by an Indian company that had little experience in LNG. High quality LNG and petroleum industry consultations were expensive by nature and around USD 3-4 million was usually charged for such a consultation.

Moreover, the CEB had already called for tenders for an FSRU, although the feasibility study had not been finalised. Given the fact that everyone in the industry knew that CEB was to float this tender by February, the ADB can’t deny knowledge of it, industry sources said.

The total allocation by the ADB for the feasibility study on identifying optimal LNG facility for Sri Lanka (i.e. land based or floating storage and regasification unit), most suitable locations to develop LNG power plants and associated facilitate) was USD 225,000. Out of this amount USD 150,000 was spent on meteorological and ocean data because both these factors affect the FSRU, according to the Terms of Reference (ToR) by the ADB. USD 45,000, out of the remaining USD 75,000, was given for international consultants for a feasibility study, according to the ToR.

“An experienced oil or gas expert is not going to work for that amount. This USD 45,000 was for three man months. Usually, an experienced consultant would at least charge USD 50,000 per month for such a consultation,” energy expert, Vidhura Ralapanawa said.

He said a study commissioned by JAICA about the feasibility of supplying gas for proposed LNG plants by India and Japan had run into several million dollars.

Ralapanawa said: “The FSRU is a serious business. The CEB is reported to have called for international proposals to deploy the FSRU and that the ADB feasibility study is not out yet. However, the fact that this was a study done very cheaply in a very expensive industry should also give us pause.”

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News

Veteran singer and musician Professor Sanath Nandasiri passed away at the age of 81

Published

39 mins ago

2023/03/28

Priyan

Veteran singer and musician Professor Sanath Nandasiri has passed away at the age of 81

News

Overtime gravy train for public sector back

Published

6 hours ago

2023/03/28

Sahan Weerasooriya

Govt. MPs make contradictory statements on state of economy

By Shamindra Ferdinando

UNP National List MP Wajira Abeywardena on Sunday (26) disclosed the issuance of a circular by the Finance Ministry to restore overtime and other payments in the public sector.

The declaration was made in Galle soon after Transport and Media Minister Bandula Gunawardane lamented that the government was short of billions of rupees to pay public sector salaries, pensions, Samurdhi payments and meet recurrent expenditure.

Minister Gunawardena and UNP National List MP Abeywardena addressed the local media after the handing over of several buses to the Galle SLTB depot.

Cabinet Spokesman Gunawardena said that the government needed as much as Rs 196 bn before the Sinhala and Tamil New Year and its projected revenue was Rs 173 bn. In addition to that Rs 500 mn was required to settle what Minister Gunawardena called bilateral debt.

Minister Gunawardane said that a part of the first tranche of USD 333 mn from the International Monetary Fund (IMF) would be utilised to pay public sector salaries.

Of the USD 333 mn received so far, USD 121 had been used to pay the first installment of USD 1 bn credit line secured from India early last year, according to State Finance Minister Ranjith Siyambalapitiya.

Power and Energy Minister Kanchana Wijesekera in the second week of August last year revealed as much as Rs 3 bn had been paid as overtime to Ceylon Petroleum Corporation (CPC) workers for several months. This disclosure was made in response to a query raised by Chief Opposition Whip Lakshman Kiriella.

One of the major demands of the public sector trade unions on the warpath over the Wickremesinghe-Rajapaksa government’s new tax formula is the restoration of overtime.

News

Now, Opposition wants Finance Secy. hauled up before Privileges Committee

Published

6 hours ago

2023/03/28

Sahan Weerasooriya

Prof G L Peris

Prof. G. L. Peiris yesterday (27) urged Speaker Mahinda Yapa Abeywardena to act speedily on the main Opposition Samagi Jana Balawegaya (SJB) request to summon Finance Secretary Mahinda Siriwardena before the parliamentary Committee on Ethics and Privileges.

Addressing the media on behalf of the Freedom People’s Alliance, the former External Affairs Minister said that the Treasury Secretary had challenged the parliament by withholding funds allocated in the budget 2023 to the Election Commission thereby sabotaging the election.

Prof. Peiris said that there couldn’t be a far worse violation of parliamentary privileges than a government official undermining Parliament.

Instead of appreciating the intervention made by the Supreme Court to facilitate the delayed Local Government polls, the ruling party had sought to challenge the apex court, Prof. Peiris said, urging Speaker Mahinda Yapa Abeywardena to fulfill his obligations.

Prof. Pieris said that if the government lacked funds, just one percent of USS 333 mn received from the International Monetary Fund (IMF) was sufficient to conduct the election.

The ex-minister said that the IMF wouldn’t oppose the utilisation of a fraction of the first tranche of USD 2.9 bn loan facility provided over a period of four years to guarantee the constitutional rights of the Sri Lankan electorate. (SF)