The Single Point Mooring (SMP) challenge at Maheshkhali, Cox’s Bazar, changed into as soon as completed in March this year, nine years after being initiated by the dispute-owned Bangladesh Petroleum Corporation’s Eastern Refinery Limited. More than one opinions extended the challenge’s timeline, whereas factors equivalent to extra factors, taxes, and change fee fluctuations elevated its label to Tk8,222 crore, up from the initial estimate of Tk4,936 crore.
Construction began in 2019, funded by a $550 million Chinese language preferential mortgage, repayable over twenty years with a 5-year grace duration. The challenge underwent a trial bustle in July closing year, but a significant technical field delayed its commissioning until March this year.
The sea-to-shore floating terminal changed into as soon as designed to seamlessly transfer imported gas oils from mother vessels to storage tanks and refineries to gash transportation time and freight charges. The China-funded challenge is expected to set spherical Tk800 crore every year by slicing time from 11 days to 2 days to transfer 1 lakh tonnes of gas oils by chartered lighterage vessels that label Tk66 crore per month.
Below the challenge, six storage tanks were built in Maheshkhali alongside with a capability of 2,00,000 tonnes to Eastern Refinery, enabling it to stockpile oil for 2 and a half months’ need – offering a buffer for present disruptions.
It is now eight months because it changed into as soon as commissioned in March 2024. However the specified advantages to this level can not be reaped because the ready-to-exhaust terminal, fitted with 110 km double pipelines, does no longer have an operator yet. The instant past authorities, armed with the Mercurial Enhancement of Electricity and Energy Provide (Special Provision) Act 2010, changed into as soon as within the diagram of enticing China Petroleum Pipeline Engineering Company Ltd, which constructed the SPM, as its operator.
On condition that native operators were no longer outfitted to deal with a challenge of such complexity and scale, the Awami League authorities deliberate to nominate a global operator to control the SPM efficiently after its commissioning, officials from the dispute-owned agency BPC urged The Enterprise Identical old in October. At the starting up, the idea changed into as soon as to rent a foreign operator for 18 months, until native skills would possibly per chance well be professional to steal over the SPM’s operations.
For the reason that Chinese language builder itself equipped to operate it for three years, the then authorities changed into as soon as in favour of giving it the job below the 2010 Special Energy Security Provision Act that allowed the signing of such unsolicited contracts within the energy sector.
However the diagram purchased stuck after the abrupt 5 August drop of Sheikh Hasina’s regime via a student-led mass uprising.
Soon after taking space of job, the duration in-between authorities suspended particular energy security provisions amid criticism and controversies spherical unsolicited energy and electrical energy projects.
Complex on renewable, soft on soiled gas
In September, the energy ministry determined to scrap 31 unsolicited renewable energy projects awarded by the outdated authorities below the the same act. Entrepreneurs said the decision set apart funding proposals worth about $5 billion in clean gas electrical energy projects at stake. They claimed $200 million changed into as soon as already invested in land acquisition and numerous challenge-related steps.
If utilized, the renewable vitality flowers in these projects would have generated 2,678MW of fresh electrical energy and saved near to $820 million (Tk9,700 crore) every year in energy payments, in step with a glimpse by the Bangladesh Sustainable and Renewable Energy Affiliation (BSREA).
In the meantime, the duration in-between authorities has shaped a national committee to appear at all unsolicited energy offers signed below the Special Provision Act.
Energy Adviser Muhammad Fouzul Kabir Khan urged TBS in early September that fresh tenders would be called and selected ones would be given a depart-forward.
Starting the delicate process afresh would possibly per chance well steal no longer lower than a year, leading to merchants’ frustration and discouragement, warned renewable energy entrepreneurs who had shared their concerns with the energy adviser and requested to help them continue the projects.
On 30 November, the energy adviser at an tournament in Dhaka said a new policy changed into as soon as being developed for the renewable energy sector as he realized the outdated policy changed into as soon as no longer smartly utilized. On the the same day, the duration in-between authorities repealed the Special Provision Act but declared all present contracts made below the Act would live respectable.
Earlier than that, on 20 November, the Advisory Council Committee on Economic Affairs, chaired by Finance Adviser Dr Salehuddin Ahmed, chose China Petroleum Pipeline Engineering Co (CPPEC), the the same Chinese language dispute-owned agency that built the BPC’s single level mooring challenge to operate and preserve it.
It licensed in theory the proposal, submitted by the Energy and Mineral Sources Division, below the say buy diagram.
Officials said the detailed proposal will probably be reviewed within the upcoming meeting of the Advisory Council Committee on Government Purchase.
What impress procurement licensed guidelines suppose?
Substitute insiders suppose the BPC’s strive to award SPM’s operation and administration services straight to an unqualified contractor goes in opposition to the duration in-between authorities’s declared stance in opposition to unsolicited energy projects as reflected within the cancellation of the actual act. Contracting out a ready challenge to a sole source contractor additionally does no longer follow the original Public Procurement Rules (PPR) and public-non-public partnership (PPP) principles, they give the influence of being for.
“Despite the truth that procurement below the Special Provision Act is alleged to were shunned, it seems the Ministry of Energy is attempting to state the the same de facto vitality and award the Operations & Maintenance (O&M) contract, without delicate, for the Single Point Mooring to a Chinese language company within the guise of a concocted G2G procedure,” regarded as one of them urged TBS, wishing no longer to be named.
The Chinese language company CPPEC, chosen for the work, changed into as soon as favoured by the outdated dispute minister of energy and the then Awami League authorities earlier this year floated a young for the O&M with a doc that changed into as soon as designed genuinely for CPPEC most spirited, the insider acquainted with the diagram said.
“Regrettably, then again, as a substitute of issuing an open delicate, BPC proceeded to craft a procedure to award the contract to CPPEC on a sole source foundation, mockingly moral as conceived by the outdated authorities,” he said, questioning the energy ministry’s justification that BPC and CPPEC, every being dispute-owned enterprises, can depart for an instantaneous G2G award, bypassing open delicate process.
Of their advice, the energy ministry and the BPC claimed that such G2G say procurement is licensed below Public Procurement Principles Clause 75.0 and 76.2 and the Public Non-public Partnership Act.
“We reviewed Article 75.0 and 76.2 of the PPR and associated sub-articles, which checklist numerous conditions below which say contract would possibly per chance well be made, but curiously G2G will not be any longer mentioned or referenced in any shape or form within the referenced clauses of the PPR,” the insider said. The G2G belief changed into as soon as certainly incorporated in PPP supplementary gazette issued in 2017 and the energy ministry misrepresented the info to the advisory council’s committee by “conflating the PPR & PPP and obfuscating the illicit nature of the award”, he said in a written text sent to TBS.
Explaining G2G criteria below PPP Principles and PPP, he said the G2G Partnership gazette states that GoB would possibly per chance well fair straight engage with numerous governments and belief their toughen to implement projects on a PPP foundation.
The Bangladesh authorities did no longer engage with the Chinese language authorities regarding the O&M challenge and did no longer query China for any financial toughen or funding. The challenge is only financed by the Bangladesh authorities. CPPEC will not be any longer making any funding, as required below PPP. Thus, this challenge does no longer meet the requirement to be classified as PPP, he identified, revealing that no G2G framework settlement or memorandum of idea changed into as soon as additionally signed between the 2 governments required below the G2G Partnership Coverage for PPP projects.
He illustrious that the energy ministry is surroundings a unhealthy precedent the set apart any dispute-owned entity can contract with any Bangladesh authorities agency and reveal that the contract will also be awarded without delicate below the guise of G2G. In China, there are more than 350,000 dispute-owned entities and in Bangladesh 30-50 such Chinese language entities impress change, he identified.
“We have additionally realized that CPPEC has no trip whatsoever in endeavor O&M of SPM – no longer even a single challenge,” he said, great BPC’s reveal that CPPEC has “commissioning” trip of offshore pipelines in Angola and Abu Dhabi.
“Our investigative analysis leads us to attain that CPPEC is certainly NOT doing the O&M for the Weizhou terminal as claimed,” the change insider said.
The O&M of SPM is very advanced and poses many dangers, and the wretchedness of handing over custody of this kind of significant infrastructure of national passion to an “inexperienced and novice contractor” will also be very grave, he warned.
“As a replacement of investigating the repeated label increase of the EPC contract below the outdated regime, it looks that evidently the fresh authorities desires to extra reward the the same transgressing actors,” said the insider, who totally examined the contract process, regarding cost escalation of the SPM challenge.
Government procurement officials, then again, said even supposing the Special Provision Act has been repealed, present principles additionally allow the authorities to depart for say contracts on definite prerequisites.
“Yes, PPR 2008 stipulates that the say procurement diagram is allowed for the operation of a challenge by the builder/contractor. Whereas you earn a port as a contractor, it is probably you’ll per chance well presumably fair earn the operation contract via DPM, equipped that CCEA approves it,” said a common senior govt of the PPP Authority.
Serene, there’ll not be this kind of thing as a G2G take care of China in PPP, the respectable urged TBS.
Mohammed Shoheler Rahman Chowdhury, common director total of the Central Procurement Technical Items, now the Bangladesh Public Procurement Authority, shared a identical level of view.
He said the authorities procurement legislation offers such opportunities, but it undoubtedly is fundamental to evaluate to whom the contract is being awarded. It is hard to search out out the causes within the again of selecting a particular company without reviewing the related paperwork. Now and again the decision is justified, whereas at numerous times it would possibly per chance well fair no longer be.
The related authorities are simplest positioned to veil why an organization is chosen without an open delicate. In such conditions, or no longer it is miles fundamental to realize their rationale, and if it aligns with the principles and regulations, it will also be licensed. In every other case, appointing an organization with out a young wouldn’t be applicable, Rahman added.
