Bangladesh News

The Sylhet Gas Field Company Ltd (SGFL) today gives go ahead to a highly technical Tk 113 crore gas processing plant installation deal with a disqualified Chinese company ignoring the project consultant’s strong reservations.

A well-placed source quoting the project consultant’s views said Chinese company Sinopec that was awarded the installation of “Kailastila Molecular Sieve Turbo Expander Processing Plant” does not even have the basic understanding about how to install a gas-to-natural gas liquids processing plant.

Represented by Sahco International, Sinopec was awarded the project under political pressure last year in connivance with some high officials in the SGFL and Petrobangla, the sources said.

A source said that the SGFL at this point cannot stop this project and go for a re-tender as the contract has already been awarded to Sinopec by the past-management.

“The Sinopec was asked to furnish its performance guarantee in March and it did so. Now we have to reciprocate,” said the source adding that the SGFL board will okay the Sinopec deal today.

The project’s European consultant in its tender evaluation report warned that accepting the Chinese plant would be a ‘total disaster’ as Sinopec would not be able to deliver the end-product from their offered plant because its designs are grossly flawed.

The consultant had determined at least 50 major deviations in Sinopec’s technical proposal to set up the plant and sought 160 clarifications. The consultant observed that the Chinese bid grossly deviated from the tender specifications that cannot be corrected by mere clarifications.

Under this project, the SGFL would daily produce 16 barrels of Natural Gas Liquid (NGL) and about nine barrels of associated condensate using 45 million cubic feet per day (mmcfd) gas.

The first tender for this fractionation plant project was floated in May 2005 but it fell flat. The project was re-tendered in January 2006 and this time three offers were dropped by Sinopec, Thermo Designs and Astra-Evangelista. By February 2006, the consultant came up with its evaluation of the bids declaring Astra-Evangelista and Sinopec as non-responsive and recommending Thermo Designs of Canada.