Minister revokes process of appointing Tanahu consultant

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    KATHMANDU, Dec 20

    Tanahun-SetiEnergy Minister Radha Kumari Gyawali has revoked the process of appointing consultant for the 140-MW Tanahu reservoir-based hydropower project after second-rated Kansai Electric Company Limited of Japan looked set to not get appointed. Minister Gyawali, speaking to Karobar confirmed revocation of the process and decision to start a new process, but did not divulge the reasons for revocation.

    Local agents had been lobbying intensively to revoke the process. Their pressure may have yielded results for them but it has created uncertainty about the project that has already been delayed by two years. Joint Secretary at the policy division of the ministry Keshav Dhwoj Adhikari had proposed to appoint Kansai by internally evaluating the bidders. The Arun III Project had been aborted around two decades ago due to Minister Gyawali’s party CPN-UML and Tanahu may now face the same fate.

    The Asian Development Bank (ADB) had earlier selected a joint venture of Lahmeyer International (Germany) and Manitoba (Canada). Promoter Tanahu Hydropower Limited in May had even issued letter of intent to Lahmeyer, held a round of dialogue with it and asked to manage staffers. The government had initiated the project to reduce load-shedding during the dry season, and investment has already been arranged for the project. Apart from the ADB the Japan International Cooperation Agency (JICA) and the European Investment Bank have already signed loan agreements. Promoter Tanahu has already applied with the Nepal Electricity Authority (NEA), that is building project through promoter Tnaahu Hydropower Limited, for power purchase agreement (PPA).

    Promoter Tanahu Hydropower plans to complete the project by the end of 2020. Bids for civil, electromechanical and hydromechanical contracts can only be invited after appointment of consultant. The Policies and Programs for the current fiscal year states start of civil construction. The estimated cost of the project is Rs 45 billion. The ADB has lent US$ 27 million (around Rs 2.75 billion) for procurement of consultancy service. It has signed investment agreement worth Rs 15 billion for the project. Cost of the project has already increased by Rs 5 billion due to delay, and it will rise more with further delay. The ADB has yet to comment on revocation of the process of appointing consultant. It has already warned of stopping assistance if its evaluation is ignored. There can be problem in investment for the project due to that. Tanahu Hydropower Limited earlier had aimed to complete contract agreement by January 21, 2014, send the consultant to work in February and start work by March, as per the amended working schedule. The project was earlier scheduled to be completed by 2018 and was later rescheduled for 2020. This date will also be affected.

    Director of Tanahu Sunil Kumar Dhungel has been rendered redundant with the Energy Ministry interfering in the process of appointing consultant that promoter Tanahu was to do. The ministry’s interference is against the Public Procurement Act provision that allows the office concerned to take decision about the project. The Public Procurement Monitoring Office has already written to the ministry informing that the project chief can take decision following rumors that the decision can be delayed due to interference of higher authorities.

    Major lender ADB had earlier met top officials of the Energy Ministry, Finance Ministry and promoter Tanahu Hydropower Limited and requested them to appoint the consultant by October end after the project did not move forward for eight months. The ADB had stated that its assessment has included all the issues raised by the government including that of sediment flushing. The dispute about appointment of consultant between the government and ADB had escalated after reassessment was done against agreement under supervision of the project in a way that will lead to a different result. The Commission for Investigation of Abuse of Authority (CIAA) has already initiated investigation after the side not being appointed consultant lodged complaint.

    The ADB itself had invited bids and selected consultant as per loan agreement. It had reassessed the evaluation report after controversy about the process and has been stating that its evaluation is right. The Energy Ministry, Finance Ministry and ADB had appointed a separate independent expert group after escalation of dispute and the group had also found that the ADB’s evaluation was right. The ADB had selected a joint venture of Lahmeyer International (Germany) and Manitoba (Canada) on the basis of financial and technical offers from among the bidders as per its procurement guidelines.

    Lawmakers seek minister’s resignation

    Lawmakers from Tanahu have demanded resignation of Minister Gyawali claiming she has revoked the process of appointing consultant for the project under influence of hydro mafia. Organizing a joint press conference on Saturday they have accused her of putting the project’s future in uncertainty revoking the process at a time when the process of appointing consultant was moving forward after seeing that her interest will not be served.

    Accusing her of betraying the state and people of Tanahu the lawmakers including Shankar Bhandari, Dhruba Wagle, Janak Raj Joshi, Ram Chandra Pokharel, Jhul Bahadur Ale, Asha Koirala and Shiva Lal Thapa urged Prime Minister Sushil Koirala to dismiss Minister Gyawali immediately.

    Source : Karobar Daily