earlier initiated steps for putting the matter into ECC held on July 17, 2013 shows mala fide regarding the award of tender to ETPL bypassing PPRA rules and prime facie no competitive measure in award of tender has been ensured. It is also correct that Inter-State Gas System is not procuring agency, and it has acted on behalf of Sui Southern Gas Company Limited (SSGL). However, it is the fact that SSGL is also not a procuring agency but instead it is Sui Northern Gas Pipelines Limited (SNGPL). It is also fact that ISGS has acted on verbal directions instead of clear written authority. However, the report said that further facts need to be verified.
It has been mentioned in the interim report that ISGS (inter-state gas system) without consulting the SSGC or SNGPL converted integrated project into tolling project and also without involving both advertised and issued corrigendum. The report also found that on July 16, cost of the terminal stood at $30-40 million that was later on, in a financial bid quoted at Rs120-130 million and same was accepted by ISGS. It also highlights the fact that since advertisement on August 7, 2013, Pakistan Gas Port Limited (PGPL) being potential bidder raised various queries and observations about the adopted mechanism and the favour extended to ETPL.
The corrigendum made after August 7, 2013, is also mala fide in which capacity charges, tenure of the project and other necessary material additions were proposed. The PGPL, the report mentions, complaints that the said corrigendum was issued with the request and demand of ETPL. The NAB’s interim inquiry also highlights the fact that initially the Port Qasim Authority (PQA) also raised several observations on the proposed sites of ETPL and PGPL, but suddenly showed consent on the proposed sites of ETPL and allotted 13 acres of land. Furthermore PQA hired 4 tugs for LNG purpose only at the rate of $8,895 per tug per day that means PQA will be paying $12,951,120 per day. The facts further needs to be inquired into, the report says. It is also fact that all three technical Evaluation Reports dated October 23, 29 October and November 5 2013 are undersigned. The SSGS and ISGS are not aware of the whereabouts of the original reports.
The evaluation further demanded verification of independent consultants. It is intriguing that QED awarded sufficient marks and declared PGPL technically qualifier in 2012, but suddenly disqualified it in the year 2013 based on its unsigned technical evaluation report. It is also fact that PGPL since August 2013 raised several observations before ISGS, PPRA and others. It also pinpointed that the signing of LSA (LNG services agreement) with ETPL is beyond understanding as the SSGC is not a procuring agency. The NAB also found that SSGC has paid unauthorisedly billions of rupees to ETPL as per the record, ETPL received 4 billion in approximately 130 days against the capital investment of Rs12 or 13 billion only. At this rate, the capital investment of ETPL shall be recovered in 14 months and in the remaining 13 years ETPL will continue to earn huge dividends. This aspect is further required to be investigated in detail. There are also so many other aspects which also need to be completed and this also includes the examination of high profile personalities such as federal Minister for Petroleum and natural resources, ECC members, Federal secretaries, Chairman Engro, MG ISGS, MD PSO and others.
However, Chief Executive of EVTL (Engro Vopak Terminal) Syed Mohammad Ali when contacted said that the findings of interim inquiry report are baseless as the ETPL has won the LNG terminal contract through transparent bidding process in line with PPRA rules. Inter State Gas company has implemented the PPRA rules in every phase of the tender for the project and to this effect the PPRA rules are available on its website. Mr Ali argued that both parties ETPL and PGPL under single stage two envelope procedure as per PPRA rules submitted their bids simultaneously with Inter State Gas System. Both the parties submitted two envelopes (containing technical and commercial proposals) each. The QED consultant conducted the technical evaluation and cleared the technical bid of ETPL whereas it disqualified the PGPL after finding out that its technical proposal was not up to the mark. After that the commercial bid was opened of the party which qualified in the technical evaluation. So this is how the ETPL won the contract and there is no violation of rules and no favours have been extended to the ETPL.
When asked why QED did not open the commercial bid of PGPL, Mr Ali said that PGPL was already disqualified in technical evaluation which is why QED did not open the commercial bid of QED. He said both the parties had simultaneously submitted the technical and commercial bids in separate envelopes, so there is no question of any injustice done to any party in the bidding process. If PGPL had some objections over not entering its commercial bid, it should have gone to court at that particular time, but the said party did not move meaning thereby that it accepted that the process was flawless and transparent too.
When asked as to why the cost of LNG terminal that was at $30-40 million on July 16 had increased to $120-130 million in the bid which was accepted by ISGS, Mr Ali said: “Yes, the earlier cost of LNG terminal was at $30-40 million, but that was the extension of the existing jetty of Engro Vopak. That particular proposed LNG terminal had the handling capacity of just 200 mmcfd and the flow of LNG was to be erratic as incase the ship containing chemical products gets anchored, then the LNG supply was not possible. So that kind of terminal was not approved by the authorities concerned. So the cost of the LNG terminal was increased to 120-130 million dollars as the new and separate jetty was constructed for LNG terminal having the maximum LNG handing capacity of 690 mmcfd. The LNG terminal of $130 million ensures the smooth LNG handling. EPTL is bound to re-gasify 400 mmcfd LNG under contract with government.
When formal inquiry starts, we will present our case before the investigation officers and we will satisfy them as no favour has been extended to ETPL for LNG terminal contracts, Mr Ali stressed with confidence.
