Shady rental power deal – SC makes PPR return advance with interest

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ISLAMABAD: The Walters Power International and its Pakistani associate Pakistan Power Resources (PPR) headed by Iqbal Z Ahmed, promised the Supreme Court on Wednesday they would repay in full the mobilization advance along with interest to the government’s Central Power Generation Company Ltd, which is said to give electricity production contracts and regulate them.
Both the companies were directed by the SC to repay the advance after detection of fraud by National Electric Power Regulatory Authority (NEPRA), in the commissioning of two rental power plants (RPPs) to be installed by them at Guddu and Naudero.
The bench was hearing a case of payment fraud regarding Rental Power Projects (RPPs) detected by NEPRA, as well as alleged corruption in Rental Power Projects. Syed Najamul Hassan Kazmi, appeared on behalf of NEPRA. The lawyers for the Guddu and Naudero projects submitted a written assurance to the three-member SC bench that their clients would return Rs 2 billion they received in advance, with mark-up.
The bench of Chief Justice Iftikhar Muhammad Chaudhry, Justice Ghulam Rabbani and Justice Khalilur Rehman Ramday said: “Everybody should follow suit on matters of the national exchequer.”
Dr Pervez Hasan, counsel for Pakistan Power Resources (PPR) and Shahid Hamid, counsel for Walters Power International, informed the court that the sum mentioned in the statement had been arranged and would be returned to CPGCL during the course of the day (Wednesday).
The court directed Abdul Malik Memon, CEO of the generation company, to conduct an inquiry into the case and submit a report at the next hearing determining responsibility for the instructions on which it agreed to pay both the companies without considering facts and circumstances.
According to the statements they made in court, PPR and Walters Power International had already paid Rs .405, 992, 246 and would pay the remaining Rs 301,058,766 by the time Wednesday was out. PPR is also paying Rs 120,000,000 on account of interest/markup on advance payment, while WPI told the court that advance payment of US$ 11,036,666 and US$ 180,753 in interest were being paid.
The court adjourned the case for the 14th of December.

3 COMMENTS

  1. It is a matter of shame for the whole nation as PPIB, Ministry of Water & Power, and NEPRA were the parties who blessed the competitive bidding process for these rental power plants and they were a party to the entire process.
    NEPRA processed these cases for license and approved their tariffs knowing that technology prices have been over inflated for these projects, Power Procurement Authority rules had not been followed, and contracts were not kosher.

    MUNEER A. SHEIKH
    EX-Director General (Standards)
    N.E.P.R.A

  2. Why did not NEPRA allow NTDC to borrow Rs 22 billion for these projects. NEPRA had the power and authority to not approve the power purchase contracts and also see the best effective price for these projects (as per its 2005 power procurement guidelines). it chose not to take any action knowing that fraud deals had been carried out. Had they stopped the Government and Ministry of W & P that would have resulted in removal of Chairman and Member of NEPRA by the government who are political appointees and skilled in other than electrical engineering/law/economics/finance field to run the organization.

    I was working with NEPRA at the time and agitated the issue several times through communications to the Authority carrying out analyses helping the media with understanding the problems with these deals (Please check with Kashif Abbassi of ARY TV) who conducted the munazara between raja parvaiz Ashraf and Faisal saleh Hayat, and along with publishing artilces on my own, helping Advocate Mr. Anwar Kamal and submitting a detailed report addressed to the Chief Justice of Pakistan making him aware of these shady deals.

  3. Several high power politicians and bureucrats and government officials accepted kick backs and bribes and it was going on under the nose of the regulator. Now when the wind is blowing in the other direction, NEPRA chooses to point out the problems in processing and handling of these contracts.

    Can someone hold NEPRA accountable to what it was supposed to do under its Act, rules and regulations. Had NEPRA done its job efficiently and effectively, it could have been avoided. It needed courage to stand up to the higher authorities and take some bold decisions. however, if you are part and parcel of them, how can you take decision against them whether you are personally involved in these scams or not.

    My reports and articles are available on NEPRA website under NEPRA newsletters

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