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Moves to kick-start Rs.15bn mega pipeline project comes under fire

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Despite anticipated drop in fuel consumption for thermal energy

bY SURESH PERERA

With three major Liquefied Natural Gas (LNG) projects now on the cards coupled with the commissioning of the Mannar wind power plant, questions are being raised over ongoing moves to forge ahead with plans to build a mega Rs.15 billion cross-country oil pipeline when the long-term demand for thermal power is expected to drop drastically.

The renewed interest within some quarters with political blessings to implement the proposed pipeline project at such stupendous cost has raised eyebrows as the monthly consumption of 45,000 metric tons of fuel to generate costly thermal energy will no longer be necessary with LNG and wind power supplementing the country’s demand for power, industry officials said.

At a time Sri Lanka is facing a grave economic crisis due to the Covid-19 pandemic, what is the urgent need for a cross-country pipeline when there will be far less fuel imports in the long term?, they asked.

With a proposed solar power project at Siyabalanduwa also in blueprint stage, constructing a high cost pipeline at this juncture is as insensible as “watering outdoor plants when it’s raining”, and ultimately result in the project being rendered redundant with billions of rupees going down the drain, they opined.

In addition, bids have already been called to build a new pipeline to facilitate the transfer of jet fuel from the Muthurajawala tank farm to Katunayake at substantial cost. Under the circumstances, what’s the viability of investing on another project when alternate energy sources will make thermal power generation irrelevant in the long run, industry players further queried.

Even if the cross-country pipeline project begins tomorrow, it will take another four years for its completion, whereas the LNG plants will be operational within three years. With a lifespan of 25 years on the pipeline, the country will not be able to recover even the cost of the multi-billion rupee project, they asserted.

Sri Lanka has already signed three major LNG deals with the governments of China, India and Japan. While the proposed combined plants are expected to add 1,400MW to installed capacity, the transnational agreements will play a key role in mitigating unreliability in hydro power supply while bolstering foreign capital inflows.

Sri Lanka’s fuel consumption per day is 5,000 metric tons, of which 1,500 metric tons are channeled to generate thermal power. While the Sapugaskanda facility has the capacity to refine 2,000 metric tons of crude oil per day, the balance 1,500 metric tons are imported as refined oil.

Lanka IOC directly imports refined oil, which is stored and distributed by Ceylon Petroleum Storage Terminals Limited (CPSTL).

A tanker load of 40,000 metric tons of fuel can be discharged within 24 hours. With the anticipated drop in fuel consumption for thermal energy after the proposed entry of LNG into the energy market, the number of tankers can be also reduced with a substantial cost saving, industry officials said.

The cross-country project was first proposed during 2013-14 but was shelved with the construction of the Muthurajawala oil tank farm, which was augmented by a new oil pipeline at the Sapugaskanda Oil Refinery by CPC (Ceylon Petroleum Corporation) engineers.

However, renewed interest on the project re-surfaced during the tenure of the previous UNP government with then Minister Kabir Hashim presenting to the Cabinet a bid by Langfang-based China Petroleum Pipeline Bureau to build the pipeline at a cost of Rs. 15 billion.

A Malaysian company, which quoted Rs. 7.5 billion for the proposed project was disqualified at the time as its tender documents were apparently “not in order”.

Under the new dispensation, the CPSTL sought the cancellation of the tender awarded to the Chinese company as the CPC engineering team reached the conclusion that they can undertake the job after a new feasibility study and related research were conducted to find alternatives as the estimated Rs. 15 billion cost factor was enormous.

The project could be completed internally within 30 months at a cost of Rs. 5 billion, which translates into a saving of Rs. 10 billion for the country. However, with multiple alternate sources of energy in the offing, it has been determined that it was unviable to implement such a mega project at tremendous cost when another new 18-inch diameter pipeline would suffice to meet the demand.

It doesn’t make sense to call for international tenders to build pipelines when local engineers are capable of achieving the feat, industry officials said. “Of course, there are no fat commissions rolling in when these jobs are handled by Sri Lankan professionals”.

In what industry players described as a “strange twist”, there are continuing overtures to push through the pipeline project in a new game plan to perhaps line the pockets of some officials as the task could be completed for one-third of the estimated cost by local engineers. “With Rs. 10 billion to throw, there will be many on the gravy train if the deal works out!”.

Meanwhile, S. D. J. Paregama, secretary of the Sri Lanka Nidahas Sewaka Sangamaya (Petroleum Branch) expressed concern over moves to revive the project, which, he said, was a waste of public funds at a time the country’s economy was in bad shape.

“After our union wrote to President Rajapaksa on the futility of implementing this costly pipeline project, he directed that it be halted immediately”, he said.

After a bout of silence, there are subtle moves now to push ahead with the project with the Chinese bidder, he claimed.

“As a trade union which supported the President at the last election, we expect him to take a firm stand to ensure that public funds are not squandered on projects that are white elephants”, he emphasized.



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COVID-19: Jaffna faces serious risk

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Top medical man in North threatens lockdown

Five villages isolated in Ganewatta DS area

20% of IDH patients need oxygen

By Dinasena Ratugamage and Rathindra Kuruwita

Tough restrictions would have to be imposed in Jaffna if religious leaders did not help health authorities, Northern Province Director General of Health Services, Dr. A. Kethiswaran said yesterday. Jaffna was facing a serious risk of COVID-19, he said.

Dr. Kethiswaran said so during a meeting with religious leaders at his office. He said that a large number of devotees were seen at various places of religious worship during the festive period.

“None of these people follow health guidelines. It is impossible to control the virus because of this. At this rate we will have to impose travel restrictions in the Jaffna District. We need everyone’s support, if we are to avoid this fate.”

He then urged religious leaders to inform devotees of the dangers of the virus and not to gather at places of worship in large numbers.

 

Dr. Kethiswaran also said that a large number of policemen in Jaffna had contracted COVID-19. About 258 PCR tests had been carried out on Wednesday after it was found that 13 policemen attached to the Jaffna Police station were infected. Altogether 788 PCR tests were done in the Jaffna District on Wednesday, Dr. Kethiswaran said.

One hundred and forty eight new COVID-19 cases had been detected in several villages in the Ganewatta Divisional secretariat area, Divisional Secretary Niranjala Karunaratne said yesterday.

On Wednesday alone 733 PCR tests had been done there, she said, adding that about 175 individuals had tested positive for COVID-19 there.

Given these developments, Tittawelgala, Hunupola, Siradunna, Aluthgama and Hettigama Grama Niladari divisions at Ganewatta Divisional secretariat area have been isolated.

Travel restrictions were imposed on Kuliyapitiya Town, Thunmodara, Dhandagamuwa – West, Kanadulla and Pahala Weerambuwa as COVID-19 cases were increasing there.

PHI in charge of Divulapitiya said that 84 new COVID-19 cases had been reported from the area during the last 48 hours. However, no decision had been taken to impose travel restrictions in the area, PHI, S.A.U.T Kularatne said.

“Twenty-eight of these patients were among people who attended a sports event organised for the New Year in Aswennawatta Grama Niladari area. Forty-four people who went on a trip at Mellawagedara have also tested positive for SARS-CoV-2. If people are not careful, things might rapidly deteriorate,” he warned.

Deputy Director of IDH said that over 130 COVID-19 patients were undergoing treatment there although the hospital could accommodate only 120 patients.

All eight ICU beds at the IDH are occupied and 20% of the patients there need oxygen. The number of people admitted to hospital had increased after the Sinhala and Hindu New year, health ministry sources said.

Director General of Health Services – Western Province Dr. Dhammika Jayalath urged people to refrain from travelling to Colombo unless it was very urgent.

Director General of Health Services, Dr. Asela Gunawardane said that the coming three weeks would crucial.

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Covid figures: Govt. accused of misleading the country

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By Rathindra Kuruwita

The College of Medical Laboratory Science (CMLS) yesterday claimed that State Minister of Production, Supply and Regulation of Pharmaceuticals, Prof. Channa Jayasumana was making statements on new strains of SARS-CoV-2 without any scientific proof.

Speaking to the media on Wednesday, Prof. Jayasumana said that there had been an increase in the spread of Covid virus in the country, especially among the young people and that was due to a new strain of the virus.

President of the CMLS, Ravi Kumudesh said: “The Minister claimed they were doing a research on this. As far as we know, neither the Ministry nor the University of Sri Jayewardenepura has done any research to identify this new strain. The Ministry of Health stopped identifying new variants a long time ago.”

The Ministry of Health could neither plan for new variants of COVID-19 nor determine what vaccine was effective as it simply didn’t have the equipment to identify new strains, Kumudesh said, adding that identifying COVID-19 variants across the country had been outsourced to the University of Sri Jayawardenepura.

“I have repeatedly said that the Health Ministry officials can’t make science and evidence-based decisions or statements on new strains. Institutions under the Health Ministry do not have the ability to identify new strains of the coronavirus; only the University of Sri Jayewardenepura has a gene sequencing machine. We said this was having a disastrous impact on the country’s pandemic response and here we are,.”

Kumudesh said that identifying various strains of COVID-19 was essential to respond to the pandemic as everything from PCR testing to selecting a vaccine, depended on that.

“There are a number of strains of the virus in the world now and we now know that the new variant that led to a lockdown in the UK is here. We have to be ready to identify what strains are coming.”

Kumudesh said that since the country had opened its airports people from various countries would arrive, carrying new strains. He added that there might also be a new strain that originated here without “our knowledge because we don’t do adequate gene sequencing.

“To identify new variants, we must sequence the genes of viruses detected through PCR testing. We need many gene sequencing machines because one cannot identify new strains through a PCR test. However, the Ministry of Health has not provided a single gene sequencing machine to labs under its purview.”

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CEA accused of turning blind eye to cardamom cultivators raping Knuckles Forest

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By Rathindra Kuruwita

A government decision to allow cardamom plantations inside the Knuckles Forest Reserve, which came under the Forest Conservation Department,it was already having a negative impact on the ecosystem, Sajeewa Chamikara of the Movement for Land and Agriculture Reform (MONLAR) said.

Chamikara said that Knuckles Forest Reserve was not only a unique ecosystem but also an important catchment area for rivers such as Mahaweli and Kalu.

“Illegal Cardamom planters had been operating in the forest area for many decades and there had been many attempts to get rid of them,” Chamikara said

About six years ago, there was an attempt to remove illegal Cardamom planters from the Knuckles Forest Reserve. When the Forest Conservation Department tried to remove these encroachers, based on a court order, several politicians and officials intervened on their behalf, the environmentalist said. Due to those interventions, illegal Cardamom planters could not be removed from the Knuckles Forest Reserve, he added.

“In many areas of the Dumbara mountain range, forest undergrowth has been cleared to make way for cardamom plantations. This has drastically increased soil erosion and the soil that is swept away by rains have been deposited in many reservoirs after being taken downstream to the Mahaweli Ganga. Moreover, many trees have been cut to use as firewood to dry cardamom. There are many structures used to dry the cardamom dotting the Knuckles mountain range and these activities cause significant damages to the ecosystem.”

Chamikara said it was illegal to cut trees, cultivate and clear land in a Conservation Forest. The offences carried jail terms or fines or both. Moreover, the court could estimate the damage done to the forest and make the guilty pay that amount. Under the law, even people who encouraged such violations could be prosecuted.

“The CEA has the power to act against those who carry out such illegal activities. According to Section 23 (a.) (a.) of the National Environmental Act, when a project is carried out without obtaining approval, the CEA can present such people before a magistrate’s court. If found guilty a person can be fined up to Rs. 15,000 or imprisoned up to two years or subjected to both. Unfortunately the authorities concerned are turning a blind eye.”

 

 

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