Raising concerns over the basis of awarding the Build, Operate, and Transfer tender to set up a second 300MW LNG power plant to Lakdanavi Ltd., the LTL Staff Union yesterday feared its fully-owned subsidiary may face bankability issues as a result.
“The bankability of the project is in jeopardy, due to a lack of clarity on which basis the tenders are being awarded, as it is outside of the accepted system,” LTL Holdings Staff Union President Sameera Ganegoda said.
Two weeks ago, the Cabinet approved a proposal by Power, Energy and Business Development Minister Ravi Karunanayake to award the tender to set up the BOT 300MW LNG plant, which was tendered in 2016, to the GCL Consortium as per the Procurement Appeal Board (PAB) recommendations, while approving the awarding of a project to build a second 300MW LNG plant at the same location to LTL, at the rates quoted by the company for the first tender.
Ganegoda questioned the basis under which the tender was awarded to the GCL Consortium, if the LTL tender, which came in lowest, has been deemed acceptable by the Cabinet to be awarded a second tender with the same specification.
“If the Cabinet accepts our bid as a credible party at the price we quoted, then the tender should be awarded to us as we are the lowest bidder,” he stressed.
In a two-year-long procurement process where several Technical Evaluation Committees were appointed to assess the same tender, Lakdanavi Ltd. was recommended to be awarded the contract twice, while GCL was also recommended twice. The proposal by Karunanayake followed PAB recommendations, but also recommended that the project for another plant, to be commissioned in 2021, be awarded to Lakdanavi, on the rates given for the first tender.
Bidding by Lakdanavi Ltd. has been mired in controversy, as other bidders have raised concerns of conflicts of interest, due to the role played by the Ceylon Electricity Board in the company. Ceylon Electricity Board owns 63% of LTL Holdings, of which Lakdanavi is a subsidiary.