Sri Lanka runs out of time to bring 12 coal shipments to Norochcholai
Sri Lanka is running out of time to bring 12 coal shipments to run the Norochcholai coal power plant with full capacity of 900 megawatts before April 20 and manage the monsoon season (April to September), Ceylon Electricity Board sources said.
For a season Lanka Coal Company (LCC) needs 2 million metric tonnes of coal – 33 ship loads to manage the current season and also for the monsoon season.
The LCC is bringing 21 ship loads of coal under already given contracts to two supplier companies last year, official documents revealed.
However, the 12 balance shipments should arrive before the monsoon season starts.
The procurement committee has called for Expressions of Interest (EOI) from prospective suppliers and government to government proposals, on a long-term credit basis to bring these 12 shipments and the EOI was called by LCC for this purpose last year.
For the first time, for a contract of over US$ 300 million, an EOI was called from suppliers without asking to submit a bid bond. Further they were not asked to give a performance bond too, official documents indicated.
This has paved the way for the already selected supplier of the 21 shipments who used to take a 100 percent advance payment in US$ to continue supplying and also to get the 12 shipment deal calling it an ‘emergency’ purchase, a senior official who wished to remain anonymous told the Business Times.
The 12 shipments must arrive at the Colombo Port before April 20 somehow to avoid the long hour power cuts, he added.
A recent cabinet decision has recommended to award the contract to the “first company, if they don’t perform then award to the second company and if they don’t perform then award it to the third company selected by the procurement committee”.
The first company has been awarded the contract three weeks ago and they are still dragging the placement of coal shipment order giving promises only up to now, Energy Ministry sources divulged.
If they take two more weeks and if the second company takes another four more weeks, none can bring the 12 shipments before April 20, a senior official said.
This was because the ships must come from Russia and it takes 30 days to arrive at the Colombo Port.
Under this set up the easiest thing will be for LCC to ask for a performance bond from all three companies and to award to the company which gives it without delay, he suggested.
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