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Saturday, February 25, 2006

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HEADLINE
 
ECNEC rejects Siddhirganj Phase II plant for fund shortage
Another nail in power coffin
S M Jahangir
2/25/2006
 

          Installation of the much-talked-about Siddhirganj 210 megawatt (MW) phase-II power plant has become uncertain again with the government's top decision-making body rejecting the bid on ground of fund scarcity.
The rejection of the project casts a shadow over the government plan to raise electricity generation in the near future.
Despite approval of the government's purchase committee, the proposal for implementation of the Siddhirganj 210-MW power project was rejected by the Executive Council of National Economic Council (ECNEC) at its recent meeting, official sources said.
"Although the project proposal was placed before the ECNEC meeting held on January 31, 2006, the ministry of finance refused to approve it on the plea of the government's fund constraints," said an official.
The government has already taken nearly three years to complete the bidding and approval processes of the project.
Earlier, the government accepted offers for the project on January 2004 with some five companies taking part in the bidding.
But the authorities took at least two-and-a-half years to evaluate the bidders' offers, according to official sources.
Even after the evaluation, the government could not award the project to the bidder due to some technical problems coupled with the bureaucratic tangles, sources claimed.
As the lowest bidder US-based New England Power Company (NEPC) offered the government to install the power plant on a turnkey basis at a cost of Tk 6.40 billion, according to an official source.
A few months back, the authorities raised the project cost by about Tk 1.5 billion to over Tk 8.0 billion, a senior government official informed the FE recently.
With the revision, the scheduled time for acceptance of tenders for the project has been deferred at least 17 times, bringing some changes in the terms and conditions.
The bidding price was less than half of the installation cost of the first unit of the 210 MW power plant at the same location, the source said, noting the first such power plant was installed at the cost of Tk 13.50 billion.
Taking the unprecedented delay in the awarding process into consideration, the Prime Minister's Office (PMO) asked earlier the authorities concerned to take necessary steps for the early implementation of the project.
Beside, former US envoy in Bangladesh Harry K Thomas had sent a letter to the PMO seeking removal of uncertainty over the project works, an official acknowledged.
Meanwhile, at the advent of summer, power crisis has taken a serious turn, disrupting industrial productions, irrigation activities of current 'boro' crop and people's normal lives across the country.
A huge shortfall of electricity is forcing the authorities to go for frequent load shading, sources said, adding the country is experiencing about 1,000 MW of power shortage every day.
The country's total power generation was recorded at about 3045 MW Thursday against the minimum demand of 3900 MW, according to officials.

 

 
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