Power plant construction tender-Batagoda, Lakdhanavi battle it out in Ravi’s presence
Posted on February 21st, 2019

By Shamindra Ferdinando Courtesy The Island

Power, Energy and Business Development Minister Ravi Karunanayake, yesterday, assured that the government’s decision in repect of the construction of two 300 MW liquefied natural gas (LNG) power plants wouldn’t be reversed.

Sri Lanka couldn’t further delay decision on Kerawalapitiya power plants under any circumstances, Karunanayake told The Island after the conclusion of an open forum at his ministry at No 72, Ananda Coomaraswamy Mawatha, Colombo 07, where Ministry Secretary Dr. Suren Batagoda had a heated argument with Chief Operations Officer of Lakdhanavi Ltd, Dammika Nanayakkara over the awarding of the first of the two contracts to GCL Windforce and RenewGen at the expense of Lakdhanavi.

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Battle over proposed Kerawalapitiya power plant: (L) Minister Karunanayake stressing a point (C) Dr. Batagoda flaying Lakdhanavi (R) Dhammika Nanayakkara striking back. (Pics by Gamini Munasinghe)

In addition to Nanayakkara, Lakdhanavi was represented by Ravindra Pitigalage, Chief Financial Officer of the institution.

In an unprecedented move, Karunanayake allowed the presence of the mainstream media, social media and other interested parties, including GCL Windforce and RenewGen was represented by its CEO Manjula Perera.

Karunanayake explained why he in consultation with his deputy minister Champika Premadasa had decided to award the contracts to GCL Windforce and RenewGen and Lakdhanavi. Reiterating that the contracts for 300 MW plants had been awarded in a transparent manner, Karunanayake said that he felt there should be an open forum to discuss the issue. Among those invited by Karunanayake were representatives of Colombo-based diplomatic missions which represented the interests of some of the foreign firms involved in proposed projects undertaken by GCL Windforce and RenewGen and Lakdhanavi.

Karunanayake pointed out that some diplomatic missions had acted contrary to protocol by issuing statements. The minister refrained from naming any country.

Karunanayake found fault with a section of the media for what he called inaccurate reporting and the misrepresentation of facts.

Lakdhanavi representative Nanayakakara launched a blistering attack on Dr. Batagoda, accusing him of throwing his weight behind with GCL Windforce and RenewGen. Having explained the inordinate delay in the tender awarding process, Nanayakkara revealed how Dr. Batagoda had asked Lakdhanavi to withdraw its bid.

Batagoda didn’t deny the accusation.

The Island sought an explanation from Karunanayake and Batagoda whether the ministry under his leadership had deviated from the established procedure in respect of two power plants launched by his former colleague Ranjith Siyambalapitiya when the SLFP held the power ministry in yahapalana government. The Island also pointed out that the power ministry had been under the UPFA for 51 days following the constitutional coup by President Sirisena and MP Mahinda Rajapaksa.

Karunanayake emphasized that it wasn’t a political issue. Regardless of party politics action had to be taken to finalise contracts as a further delay could cause catastrophe situation. Karunanayake said that he had gone ahead with Siyambalapitiya’s move.

Lakdhanavi representatives and Batagoda had a heated argument in a bid to justify their actions on the basis of the stand taken by Technical Evaluation Committees (TECs), Cabinet Appointed Negotiation Committee (SCAPC), Procurement Appeal Board (PAB) and Cabinet in respect of the power plants.

Dr. Batagoda, with Karunanayake seated on his right, reminded Nanayakkara that initially he had been accused of planning to hand over the project to Lakdhanavi. Dr. Batagoda alleged that interested parties had conducted an aggressive media campaign against him and on a number of occasions Lakdhanavi raised the Kerawalapitiya issue with the Cabinet Committee on Economic Management (CCEM), headed by Prime Minister Ranil Wickremesinghe.

Batagoda said that he had been subsequently accused of planing to hand it over to Samsung JV Korea Group.

An irate Batagoda said that Nanayakkara seemed to be of the view that members of the TEC and SCAPC had accepted instructions from him in this regard. Responding to Nanayakkara criticism as regards his role in the process, Dr. Batagoda reminded Lakdhanavi representative how some contracts had been awarded to LTL Holdings. Lakdhanavi is a subsidiary of LTL Holdings.

LTL Holdings, yesterday, declined an invitation from Karunanayake’s Ministry to participate at the open forum as one of its subsidiaries, Lakdhanavi bid for Kerawalapitiya 300 MW dual fuel combined cycle power plant.

Chief Financial Officer of LTL Holdings Pitigalage told The Island that though the original plan was to have two 300 MW dual fuel combined cycle power plants (first two years diesel before switching on to LNG), finally the Cabinet had approved two LNG plants. Even the basic criteria had been changed thereby causing further confusion.

Batagoda recalled how a Buddhist monk had moved the Court of Appeal against him over the Kerawalapitiya.

Pointing out that the country hadn’t been able to build new power stations for a decade or so, Nanayakkara flayed Lakdhanavi bosses of challenging his authority in spite of him as the Secretary to Power, Energy and Business Development Ministry controlled 63 per cent of LTL Holdings’ shares. Dr. Batagoda insisted that Lakdhanavi couldn’t act contrary to the position taken by the ministry.

Nanayakkara and Pitigalage had sought an explanation from Dr. Batagoda as to the applicability of 1998 and 2006 procurement guidelines in respect of Kerawalapitiya projects. Dr. Batagoda said that decisions had been made in terms of both sets of guidelines. The Lakdhavani team pointed out how decisions couldn’t be taken on both guidelines while highlighting specific instructions issued by the Finance Ministry with regard to the applicability of 1998 guidelines in this regard.

Nanayakkara told Dr. Batagoda: “You didn’t follow procedures.” Dr. Batagoda, immediately displayed copy of a letter to challenge Nanayakkara over accusation that he didn’t follow procedures.

Karunanayake said that he had held the finance portfolio at the time the Department of Public Finance issued instructions in this regard.

Alleging that Lakdhanavi was making a deliberate bid to deceive the public, Dr. Batagoda said he couldn’t ignore representations made by various parties, including the diplomatic community. Dr. Batagoda said that he was struggling to cope with some complicated matters while the likes of Nanayakkara was carrying out personal attacks.

Batagoda said the LTL had benefited from the interventions made by the ministry/CEB on its behalf. When Nanayakkara insisted that LTL or Lakdhanavai hadn’t been the recipient of privilege status, Dr. Batagoda said that he could release a list of projects given to them sans tender procedures.

The media raised the contentious issue of Lakdhanavi depicting itself as a profit making private enterprise whereas Dr. Batagoda insisted that the state owned controlling shares.

The media also sought an explanation as to how the government could give one 300 MW plant to GCL Windforce and RenewGen in terms of tender procedures and grant the other contract for a plant of a similar capacity to Lakdhanavi sans tender. Lakdhanavi representatives said that they weren’t agreeable to the move, which they called illegal.

An angry Dr. Batagoda claimed that it was Lakdhanavi which had proposed the two projects should be given one each to GCL Windforce and RenewGen and them. Dr. Batagoda claimed that the bone of contention was which one of them received the contract to be implemented first.

Asked by The Island when Lakdhanavi had made this proposal, Dr. Batagoda said four or five months back.

Dr. Batagoda alleged that Lakdhanavi had repeatedly interfered and brought pressure to bear on all concerned and was the cause of current problem.

Towards the end of the forum, Dr. Batagoda alleged that the CEB subsidiary had been increasingly conducting its affairs in an aggressive manner and recently it had gone to the extent of refusing to cooperate with the ministry with regard to a request to furnish a report on all its assets.

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