Bangladesh News

The Power Development Board (PDB) is opting for an inexperienced and unqualified Chinese company yet again for its 100 to 150 megawatt (MW) gas turbine power project in Sylhet, the same way inexpert Chinese company Harbin was awarded power projects, sources said.

Under pressure from a powerful lobby, a PDB tender evaluation committee is set to recommend Shanghai Electric Group Company, China for the project as the lowest bidder with a price tag of US$ 100 million (US$ 48.34 million, € 36.35 million and Tk 20 crore). The biddings offered by the three other bidders are also very close to the price offered by Shanghai Electric.

But neither the Chinese company nor any of the three other bidders actually qualify for the tender.

The evaluation committee found that all the bid proposals lack some necessary documents and they fall under the rejection clause of the tender. As per the Public Procurement Rules, there is no scope for evaluating the bids that do not comply with the rules.

But the tender committee negotiated with Shanghai Electric two weeks back in violation of the tender rules.

The tender floated on October 26 last year for this project had flaws in it since the beginning as the power ministry on December 12 abruptly changed a bid criterion allowing any power company having overseas experience of installing ‘any type’ of power plant to bid for the project.

The original bid criterion set by the PDB said a power company must have the experience of installing gas turbine power plants for being eligible for the job.

The change was made saying it would ensure greater participation of bidders. In reality, it paved the way for some inept power companies to participate in it.

Only four companies — Shanghai Electric, China Chenga Electrical Ltd and Bharat Heavy Electrical Ltd (Bhel) and Gammon Sadelmi JV of India — submitted proposals in March.

Of them, Bhel is the most experienced gas turbine power company. Although Bhel won two bids in the country before, its bid offer was flawed and subject to rejection like the three other bids.

Instead of rejecting the bids, the tender committee took a long time for evaluating those and has recently come up with the decision of recommending Shanghai Electric for the project.

Shanghai Electric cited Barapukuria coal-fired 250MW power plant as one of its accomplishments whereas the plant was actually built by a Chinese consortium led by CMC along with Shanghai Electric and SEEC.

“Shanghai Electric failed to prove its overseas experience. It submitted a provisional acceptance certificate (PAC) from Pakistan water and power development board in the name of CMEC and another from Iran energy ministry in the name of CMEC-Shanghai Electric, which are unacceptable,” said a source.

The Chinese company offered a gas booster compressor (GBC) from Shanghai Fiorentini, China that has no experience in supplying such equipment.

In order to cover up this shortcoming, Shanghai Electric submitted performance certificate issued by end-users mentioning that Pietro-Fiorentini, Italy, not Shanghai Fiorentini supplied the GBC.

Gas booster was a major issue for the Harbin’s Tongi 80MW power plant that tripped many times because of a flawed GBC installed by that company. The plant tripped over 100 times in the first two years of its operation since March 2005.

Besides, Shanghai Electric submitted manufacturer’s authorisation in plain papers without any letterheads and has not provided Peak Load Data of the offered equipment in the guaranteed data sheet as required.

Shanghai Electric’s bidding is US$ 100 million whereas the read out price offered by other bidders are actually lower and interestingly, all the three offers hover around US$ 95 million. But these offers proved to be costlier than that of the Shanghai Electric when the tender committee added the costs of spares.

The recommendation is likely to be sent to the PDB board next week. A powerful ruling party man is allegedly putting pressure on the PDB committee to favour the Chinese company.

“It’s being done the same way Harbin was awarded power projects in Tongi, Fenchuganj and Chandpur under pressure from Hawa Bhaban,” said an official.

A PDB high official said, “The PDB must be allowed to work on its own. The ministry or any other authority should not change the bid criterion. It’s the job of the PDB to find what is right. Otherwise, the power projects will suffer.”

The technical evaluation of the bid is yet to be completed. On its completion, the tender committee will make a power point presentation before the PDB board explaining the bids, he added.