PAC directs not to pay variation order amount to contractor of Chamelia project

KATHMANDU, July 1:

Tunnel ChameliyaPublic Account Committee (PAC) of legislature-parliament on Tuesday directed the Ministry of Energy (MoE) and Nepal Electricity Authority (NEA) not to go a head with NEA’s earlier decision to pay variation order to the contractor of Chamelia Hydropower Project. 

Minister for Energy Radha Gyawali-led NEA’s board meet two weeks ago had decided to pay Rs 1.09 billion to the civil contractor China Gezhouba Water and Power of the project for the additional works of the tunnel. 

PAC further said that the payment should be halted until it issues another direction after needful study. 

Contractor was pressing for the payment of the additional works carried out by the company due to squeezing while digging the tunnel. 

Earlier, consultant of the project had recommended to pay Rs 1.23 billion to the contractor. However, a separate foreign experts invited by the government had reduced the amount payment to 1.09 billion. 

Squeezing has incurred extra works in about 900 meter of the tunnel. 

Project is located at Darchula and is being developed by NEA itself. 

Asked by PAC members to clarify why to pay the variation order, Minister Gyawali failed to furnish the clear answer. On the occasion, Minister Gyawali expressed her ignorance over why the project cost of NEA developed project has increased. 

Though the initial cost of the project was Rs 8 billion, now it has been projected to reach Rs 20 billion. 

PAC’s discussion is undergoing for couple of weeks on whether the Power Purchase Agreement should be signed with the foreign investors and the projects of the foreign investment projects in foreign currency. 

PAC members said that they are mulling to form a sub-committee to study and provide concrete suggestions on PPA issues. 

Source : Republica