LNG Scam is a Hangman’s Noose
by Kumar David
There has been a news blackout on the liquid natural gas (LNG) deal that Basil Rajapaksa’s Ministry has entered into with the American company New Fortress Energy (NFE). The Sunday Island Editorial last week 26 September expressed concern about lack of transparency of facts and secrecy in negotiations. The deal is a response to an “unsolicited bid” is the official line but how much soliciting and wheeler-dealing went on no one will never know. The negotiations though commenced when Prime Minister Mahinda Rajapaksa was Finance Minister. I am not picking on the deal because it’s an American company, not at all. I am expressing disquiet about negotiating conduct, technical issues and potential long-term implications.
Before pitching into the topic I will define that ugly acronym FSRu&P (Floating Storage and Regasification unit & Pipelines). Natural gas globally is the fossil fuel of choice to replace King Coal. There is much disputation about whether one or two final coal-fired power stations will be built in Lanka in the next 15 years, but natural gas will be the eventual successor. Once released from the bowels of the earth, gas can be piped across continents. When chilled to very low temperatures it liquefies, ready for confinement in strong containers that can be brought into your kitchen or transported thousands of miles in huge tankers.
When a tanker arrives the FSRu&P game starts. Tankers can dock at a harbour designed for the purpose if you have one; if not a floating terminal is launched about five miles out at sea where LNG is stored. It can when needed be regasified – as in your kitchen gas cooker – and sent ashore via undersea pipelines. That’s the FSRU&P storyline and one of these is coming on the west coast, north of Colombo. The gas can be used in power-stations, industries and homes.
The plan is to convert the currently coal-fired 310MW West Coast Power Station (WCPS), Yugadhanavi, to gas, and to make the proposed Sobadhanavi 350MW station also gas fired. The gas-fired capacity will then be 660MW, but this is only the start. The CEB and the CPC (Petroleum Corporation) have reached an advanced stage in preparation and issue of documents calling for international bids for an FRSU and Pipelines, but not yet for the supply of LNG. Then suddenly and out of the blue the process was scuttled – it was infected by a bacillus. The Finance Ministry signed a Framework Agreement to proceed with the unsolicited or privately canvassed bid from NFE. A so-called Framework Agreement was inked in September in secrecy.
There are three harmful aspects. The first is unnecessary secrecy and unseemly sabotage of ongoing tender procedures. The second is a likely financial rip-off that may raise electricity prices and the third is a trap that will endanger Lanka’s long-term energy security and put the country’s neck into a hangman’s noose.
First things first. It is a violation of good practice to make an award to an unsolicited bid when tenders have been called; it rings alarm bells whether someone took 10%. International Competitive Tenders were called by GoSL for an FSRu&P and bid documents were issued but the Finance Ministry inked a secret deal to sell 40% of WCPS to NFE in the midst of this. The deal was reported in New Fortress’s website but not in local media. When Sirasa TV asked Power & Energy Minister Dulles Alahapperuma, he denied any agreement. Something is fishy.
Basil’s defenders and the CEB Engineers Union have locked horns. A Sinhala video by CEBEU President Saumya Kumaravadu provides an excellent summary: https://www.youtube.com/watch?v=VjWQ9tvIz1k
An English statement is at:
The second shock is that in terms of the Framework Agreement the government has entered into a Take-or- Pay (ToP) deal for LNG. ToP is a bad idea if the amount contracted is large or if the donkeys writing the contracts have little understanding of electricity generation or the complexities of manoeuvring in global LNG markets. Under the tender care of these goofs Lanka will be played for a sucker – recall the oil hedging fiasco a few years ago. Suppose a petrol company offers you a fleet of taxis free (the BAIT), but on condition you buy your petrol exclusively from it for five years (the TRAP). Suppose the value of the fleet is Rs 25 million but the cost of the petrol to be consumed in the five year period is Rs 500 million. Whether you need it or not you must buy an agreed quantum from the petrol company. The BAIT in LNG story is that NFE will buy 40% of WCPS for $250 million (investment) and the TRAP is compulsory purchase of LNG for both power stations and any others subsequently taking gas from this facility.
Pricing could also be a problem. LNG prices are volatile and swings have become mercurial in the aftermath of recent supply chain disruptions. Spot-prices vary widely between Henry Hub, Japan-Korea and the Netherlands TTF spot-markets. Bangladesh bought a cargo for delivery last month at $29.9 per million-Btu, the highest the country has paid for super-chilled fuel. The average LNG price for November 2021 delivery to Northeast Asia is $27 per million-Btu. A wise man surely will keep purchasing manoeuvrability in his own hands.
Say the CEB incurs fuel supply expenditure of $500 million per annum – I am pricing natural gas at $14.5 per million-Btu; see Technical Note below for quantity estimate. If NFE makes, say 10% to 15% on the sale it will make a profit of $50 million to $75 million per year (example only). You might say “What’s the problem we have to buy LNG from somewhere?” But if in any year (lots of rainfall say) the CEB does not need that much, too bad; it will have to Take-or-Pay even if it does not use it, like alimony to an estranged wife. There will also be a fixed charge spread over the period by means of which NFE will recover its entire investment costs.
Finally the hangman’s noose. Sri Lanka has been trapped; it is infeasible to build a second FRSU and pipelines in a relatively small country since the investment is large. Once Lanka builds one, that’s it for a decade or more. We will neither need, nor be able to afford a second for a long time. India has only six terminals in operation. In the meantime the CEB long-term generation expansion plan envisages the addition of about 3GW (3000 MW) of gas-fired generation in the period from now to 2037. LNG will become the bedrock of electricity production in the period to 2040, displacing coal. The implication of the deal with NFE is that country will be in the pocket of a foreign company for energy security for the foreseeable future. The government is doing more to jeopardise natural security than any youthful, slogan-intoning, racist or religious hothead!
Renewable energy will and should be encouraged though it’s not going to provide 70% of primary energy for electricity by 2030 except in Aesop’s Fables. The cynic will read a dangerous trick written into a shady contract. Remember how in the 1990s corrupt presidents, politicos and businessmen made a killing from oil-fired private power-plant construction and operation while the CEB, grossly unfairly, carried the flak? Something reminiscent is possible if corrupt politicos and greedy renewable energy (RE) investors act in consort. Today RE investors demand that they be paid at a rate corresponding to avoided-cost. Since one unit of RE electricity can displace one unit of fossil-fuel electricity they demand to be paid the avoided cost, which is the cost of the most expensive unit then on grid. But what if you play the following game: First jack up the price of fossil energy, then enact the drama of the brave saviour lopping off a bit at the top? It could be the game of unscrupulous politicians and RE investors to jack up the price of ‘going-to-be-avoided’ electricity first and after that play the drama of avoided-cost. I don’t need to explain; you can work out what the cynic is saying. And let’s not forget that corrupt politicos and market players impede, not assist, ecological goodness.
If 0.66 GW (660MW) were to run flat out, non-stop, every hour of the year the electrical energy output will be 0.66x24x365 = 5,782 GWh. Since plant cannot run without maintenance and since full output is not maintained all the time the actual plant-factor is, say, 70%. The output is then reduced to 5782×0.7 = 4,047 GWh. If the efficiency of generation is 40%, then the primary-source energy need at the input is 4047/0.4 = 10,118 GWh-equivalent of LNG energy. Now 1 GWh is the same as 3412×106 Btu (British thermal unit). Therefore the input LNG energy that is needed for both power-stations is 10,118 x 3412×106.which works out at 34.5 million-million-Btu per year, or dividing by 365 we get an average of 94,520 million-Btu per day (44,420 for Yugadhanavi and 50,100 for Sobadhanavi). Someone younger than age-80 kindly check these sums.
However the New Fortress Website declares: “New Fortress will initially provide the equivalent of an estimated 1.2 million gallons of LNG (~35,000 MMBtu) per day to GOSL, with the expectation of significant growth as new power-plant become operational.” There seems to be a cockup in NFE’s numbers, or maybe it’s meant to obfuscate Ministers and Administrators.
[MM stands for Metric-Million. The initial “Metric” is redundant and will be thrown out of the window in self-respecting scientific discourse. So MM simply stands for million].
Have Humanities and Social Sciences muddied water enough?
By Maduranga Kalugampitiya
The domain of the humanities and social sciences is under attack more than ever before. The relevance, as well as usefulness of the degrees earned in those fields, is being questioned left, right, and centre. The question of whether it is meaningful at all to be spending, if not wasting, the limited financial resources available in the coffers to produce graduates in those fields is raised constantly, at multiple levels. Attempts are being made to introduce a little bit of soft skills into the curricula in order to add ‘value’ to the degree programmes in the field. The assumption here is that either such degree programmes do not impart any skills or the skills that they impart are of no value. We often see this widely-shared profoundly negative attitude towards the humanities and the social sciences (more towards the former than towards the latter) being projected on the practitioners (students, teachers, and researchers) in those areas. At a top-level meeting, which was held one to two years ago, with the participation of policy-makers in higher education and academics and educationists representing the humanities and social sciences departments, at state universities, a key figure in the higher education establishment claimed that the students who come to the humanities and social sciences faculties were ‘late-developers’. What better (or should I say worse?) indication of the official attitude towards those of us in the humanities and the social sciences!
While acknowledging that many of the key factors that have resulted in downgrading the humanities and social sciences disciplines are global by nature and are very much part of the neoliberal world order, which dominates the day, I wish to ask if we, the practitioners in the said fields, have done our part to counter the attack.
What the humanities and the social sciences engage with is essentially and self-consciously social. What these disciplines have to say has a direct bearing on the social dimension of human existence. It is near impossible to discuss phenomena in economics, political science, or sociology without having to reflect upon and use examples from what happens in our lives and around us. One cannot even begin to talk about teaching English as a second language without taking a look at her/his own experience learning English and the struggles that many people go through at different levels doing the same. One cannot talk about successful ways of teaching foreign languages without recognizing the need to incorporate an engagement with the cultural life of those languages at some level. No reading of an artwork—be it a novel, a movie, a painting, a sculpture, a poem, whatever—is possible without the reader at least subconsciously reflecting upon the broader context in which those artworks are set and also relating her own context or experience to what is being read. A legal scholar cannot read a legislation without paying attention to the social implications of the legislation and the dynamics of the community at whom that legislation is directed. The point is our own existence as social beings is right in the middle of what we engage with in such disciplines. To steal (and do so self-consciously) a term from the hard/natural sciences, society is essentially the ‘laboratory’ in which those in the humanities and social sciences conduct their work. There may be some areas of study within the humanities and social sciences which do not require an explicit engagement with our social existence, but I would say that such areas, if any, are limited in number.
Needless to say that every social intervention is political in nature. It involves unsettling what appears to be normal about our social existence in some way. One cannot make interventions that have a lasting impact without muddying the water which we have been made to believe is clear. How much of muddying do we as practitioners in the field of humanities and social sciences do is a question that needs to be asked.
Unfortunately, we do not see much work in the humanities and social sciences which unsettles the dominant order. What we often see is work that reinforces and reaffirms the dominant structures, systems, and lines of thought. Lack of rigorous academic training and exposure to critical theory is clearly one of the factors which prevents some scholars in the field from being able to make interventions that are capable of muddying the water, but the fact that we sometimes do not see much muddying even on the part of the more adept scholars shows that lack of rigorous training is not the sole reason.
Muddying the water is no simple matter. To use a problematic, yet in my view useful, analogy, a scholar in the said field trying to make an intervention that results in unsettling the order is like a hydrogen atom in H2O, ‘water’ in layperson’s language, trying to make an intervention which results in a re-evaluation of the oxygen atom. Such an intervention invariably entails a re-evaluation of the hydrogen atom as well, for the reason that the two atoms are part of an organic whole. One cannot be purely objective in its reading of the other. Such an intervention is bound to be as unsettling for the hydrogen atom as it is for the oxygen atom. Similarly, in a majority of contexts, a scholar in the area of the humanities and social sciences cannot make an intervention, the kind that pushes the boundaries of knowledge, without unsettling the dominant structures and value systems, which they themselves are part of, live by, and also benefit from. For instance, the norms, values, and practices which define the idea of marriage in contexts like ours are things that a male scholar would have to deal with as a member of our society, and any intervention on his part which raises questions about gender-based inequalities embodied in such norms, values, and practices would be to question his own privilege. Needless to say that such an intervention could result in an existential crisis for the scholar, at least temporarily. Such interventions also entail the possibility of backlash from society. One needs thorough training to withstand that pressure.
In place of interventions that unsettle the existing order, what we often see is work, which re-presents commonsensical knowledge garbed in jargon. To give an example from an area that I am a bit familiar with, much of the work that takes place in the field of English as a Second Language (ESL) identifies lack of motivation on the part of the students and also teachers and also lack of proper training for teachers as the primary reasons for the plight of English education in the country. This reading is not very different from a layperson’s understanding of the problem, and what we often see as research findings in the field of ESL is the same understanding, albeit dressed up in technical-sounding language. Such readings do not unsettle the existing order. They put the blame on the powerless. Very limited is the work that sees the present plight of English education as a systemic or structural problem. Reading that plight as a systemic problem requires us to re-evaluate the fundamental structures which govern our society, and such re-evaluation is unsettling is many ways. I argue that that is what is expected of scholarship in the ESL field, but unfortunately that is not what we see as coming out of the field.
If what gets produced as knowledge in the humanities and social sciences is jargonized commonsense, then the claim that such fields have nothing important to say is valid. If what a scholar in those fields has to say is not different to a layperson’s understanding of a given reality, the question whether there is any point in producing such scholars becomes valid.
In my view, the humanities and social sciences are in need of fundamental restructuring. This restructuring is not the kind which calls for the incorporation of a bit of soft skills here and a bit of soft skills there so that those who come out of those fields easily fit into predefined slots in society but the kind that results in the enhancement of the critical thinking capacity of the scholars. It is the kind of restructuring that would produce scholars who are capable of engaging in a political reading of the realities that define our existence in society and raise difficult questions about such existence, in other words, scholars who are capable of muddying the water.
(Maduranga Kalugampitiya is attached to Department of English, University of Peradeniya)
Kuppi is a politics and pedagogy happening on the margins of the lecture hall thatparodies, subverts, and simultaneously reaffirms social hierarchies.
Selective targeting not law’s purpose
By Jehan Perera
The re-emergence of Donald Trump in the United States is a reminder that change is not permanent. Former President Trump is currently utilising the grievances of the white population in the United States with regard to the economic difficulties that many of them face to make the case that they need to be united to maintain their position in society. He is coming forward as their champion. The saying “Eternal vigilance is the price of liberty” is often attributed to the founders of the United States, Thomas Jefferson, Thomas Paine, Abraham Lincoln, among many others, though Lord Denning in The Road to Justice (1988) stated that the phrase originated in a statement of Irish orator John Philpot Curran in 1790. The phrase is often used to emphasise the importance of being vigilant in protecting one’s rights and freedoms.
Ethnic and religious identity are two powerful concepts by which people may be mobilised the world over. This is a phenomenon that seemed to have subsided in Western Europe due to centuries of secular practices in which the state was made secular and neutral between ethnicities and religions. For a short while last year during the Aragalaya, it seemed that Sri Lanka was transcending its ethnic and religious cleavages in the face of the unexpected economic calamity that plunged large sections of the population back into poverty. There was unprecedented unity especially at the street level to demonstrate publicly that the government that had brought the country to this sorry pass had to go. The mighty force of people’s power succeeded in driving the leaders of that government out of power. Hopefully, there will be a government in the future that will bring the unity and mutual respect within the people, especially the younger generations, to the fore and the sooner the better as the price is growing higher by the day.
But like the irrepressible Donald Trump the old order is fighting to stage its comeback. The rhetoric of ethnicity and religion being in danger is surfacing once more. President Ranil Wickremesinghe who proclaimed late last year that the 13th Amendment to the constitution would be implemented in full, as it was meant to be, and enable the devolution of power to be enjoyed by the people of the provinces, including those dominated by Tamils and Muslims, has gone silent on this promise. The old order to which he is providing a new economic vision is clearly recalcitrant on ethno-religious matters. As a result, the government’s bold plan to set up a Truth and Reconciliation Commission as promised to the international community in 2015 to address the unresolved human rights issues of the war, is reportedly on the rocks. The main Tamil political parties have made statements that they will not legitimise or accept such a mechanism in the absence of a genuine devolution of power. Politics must not override policies.
The sense of threat to ethnicity and religion looms too large once again for forward movement in conflict resolution between the different communities that constitute the Sri Lankan nation which is diverse and plural. Two unlikely persons now find themselves at the centre of an emotion-heavy ethno-religious storm. One is a comedian, the other is a religious preacher. Both of them have offended the religious sensibilities of many in the ethno-religious Sinhala Buddhist majority community. Both of their statements were originally made to small audiences of their own persuasion, but were then projected through social media to reach much larger audiences. The question is whether they made these statements to rouse religious hatred and violence. There have been numerous statements from all sides of the divide, whether ethnic, religious or political, denouncing them for their utterances.
Both comedian Nathasha Edirisooriya and pastor Jerome Fernando have apologised for offending and hurting the religious sentiments of the Buddhist population. They made an attempt to remedy the situation when they realised the hurt, the anger and the opposition they had generated. This is not the first time that such hurtful and offensive comments have been made by members of one ethno-religious community against members of another ethnic-religious community. Taking advantage of this fact the government is arguing the case for the control of social media and also the mainstream media. It is preparing to bring forward legislation for a Broadcasting Regulatory Commission that would also pave the way to imprison journalists for their reporting, impose fines, and also revoke the licences issued to electronic media institutions if they impact negatively on national security, national economy, and public order or create any conflict among races and religions.
In a free society, opportunities are provided for people to be able to air their thoughts and dissents openly, be it at Hyde Park or through their representatives in Parliament. The threat to freedom of speech and to the media that can arise from this new law can be seen in the way that the International Covenant on Civil and Political Rights (ICCPR) which is the world’s standard bearer on civil and political rights has been used and is being abused in Sri Lanka. It was incorporated into Sri Lankan law in a manner that has permitted successive governments to misuse it. It is very likely that the Broadcast Regulatory Commission bill will yield a similar result if passed into law. The arrest and detention of comedian Natasha Edirisooriya under the ICCPR Act has become yet another unfortunate example of the misuse of a law meant to protect human rights by the government. Pastor Jerome Fernando is out of prison as he is currently abroad having left the country a short while before a travel ban was delivered to him.
The state media reported that a “Police officer said that since there is information that she was a person who was in the Aragalaya protest, they are looking into the matter with special attention.” This gives rise to the inference that the reason for her arrest was politically motivated. Comedian Edirisooriya was accused of having violated the provisions in the ICCPR in Section 3(1) that forbids hate speech. Section 3(1) of the ICCPR Act prohibits advocacy of hatred that constitutes incitement to discrimination, violence or hostility. The international human rights watchdog, Amnesty International, has pointed out that in the case of Edirisooriya that for speech to be illegal on the grounds of being hate speech it requires “a clear showing of intent to incite others to discriminate, be hostile towards or commit violence against the group in question.” Amnesty International also notes that “When the expression fails to meet the test, even if it is shocking, offensive or disturbing, it should be protected by the state.”
Ironically, in the past there have been many instances of ethnic and religious minorities being targeted in a hateful manner that even led to riots against them, but successive governments have been inactive in protecting them or arresting their persecutors. Such targeting has taken place, often for political purposes in the context of elections, in blatant bids to mobilise sections of the population through appeals to narrow nationalism and fear of the other. The country’s political and governmental leaders need to desist from utilising the ICCPR Act against those who make social and political critiques that are outside the domain of hate speech. The arrest of Bruno Divakara, the owner of SL-Vlogs, under the ICCPR Act is an indication of this larger and more concerning phenomenon which is being brought to the fore by the Broadcasting Regulatory Commission bill.
The crackdown on the space for free expression and critical comment is unacceptable in a democratic polity, especially one as troubled as Sri Lanka, in which the economy has collapsed and caused much suffering to the people and the call to hold elections has been growing. The intervention of the Human Rights Commission which has called on the Inspector General of Police to submit a report on the arrest and its rationale is a hopeful sign that the independence of institutions intended to provide a check and balance will finally prevail. The Sri Lankan state will hopefully evolve to be a neutral arbiter in the disputes between competing ethnic, religious and partisan political visions of what the state should be and what constitutes acceptable behaviour within it. Taking on undemocratic powers in a variety of ways and within a short space of time is unlikely to deliver economic resurgence and a stable and democratic governance the country longs for. Without freedom, justice and fair play within, there can be no hope of economic development that President Wickremesinghe would be wanting to see.
Girl power… to light up our scene
We have never had any outstanding all-girl bands, in the local scene, except, perhaps…yes The Planets, and that was decades ago!
The Planets did make a name for themselves, and they did create quite a lot of excitement, when they went into action.
Of course, abroad, we had several top all-girl bands – outfits like the Spice Girls, Bangles, Destiny’s Child, and The Supremes.
It’s happening even now, in the K-pop scene.
Let’s hope we would have something to shout about…with the band Manthra – an all-girl outfit that came together last year (2022).
Manthra is made up of Hiruni Fernando (leader/bass guitar), Gayathma Liyanage (lead guitar), Amaya Jayarathne (drums), Imeshini Piyumika (keyboards), and Arundathi Hewawitharana (vocals).
Amaya Arundathi and Imeshini are studying at the University of Visual and Performing Arts, while Gayathma is studying Architecture at NIMB, and Hiruni is the Western Music teacher at St. Lawrence’s Convent, and the pianist at Galadari Hotel, having studied piano and classical guitar at West London University.
They have already displayed their talents at various venues, events, weddings, and on TV, as well (Vanithabimana Sirasa TV and Charna TV Art Beat).
Additionally, the band showcased their talent at the talent show held at the Esoft Metro Campus.
The plus factor, where this all-girl outfit is concerned, is that their repertoire is made up rock, pop, and Sinhala songs.
Explaining as to how they came up with the name Manthra, founder member Hiruni said that Manthra means a word, or sound, repeated to aid concentration in meditation, and that the name was suggested by one of the band members.
She also went on to say that putting together a female band is not an easy task, in the scene here.
“We faced many difficulties in finding members. Some joined and then left, after a short while. Unlike a male band, where there are many male musicians in Sri Lanka, there are only a few female musicians. And then, there are some parents who don’t like their daughters getting involved in music.”
With talented musicians in their line-up, the future certainly looks bright for Manthra who are now keen to project themselves, in an awesome way, in the scene here, and abroad, as well.
“We are keen to do stage shows and we are also planning to create our own songs,” said Hiruni.
Yes, we need an all-girl group to add variety to our scene that is now turning out to be a kind of ‘repeating groove,’ where we see, and hear, almost the same thing…over and over again!
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