PAC directs inquiry into Nandipur project MD’s appointment

He had no technical, professional capabilities to run power plant

Shahbaz Rana October 13, 2017
Representational image of a power plant. PHOTO: REUTERS

ISLAMABAD: As the Nandipur power project keeps bleeding, causing Rs9 billion annual loss in 2016 alone, the Public Accounts Committee (PAC) decided on Thursday to go after a blue-eyed ‘decorated’ officer of the Punjab government for failure to professionally run the troubled project.

Headed by Syed Khursheed Shah, PAC directed the Power Division secretary to hold an inquiry to determine who was behind the appointment of Muhammad Mehmood - a District Management Group officer - as managing director of Nandipur power project.

He had no technical and professional capabilities to run the plant but was appointed the project’s MD.

Power plant: Ministry reiterates Nandipur cost-efficiency

The issue of Mehmood’s appointment came up for discussion on an audit objection that pointed out Rs9.1 billion in losses during fiscal year 2015-16 due to less electricity generation against installed capacity of the plant.

As against generation capacity of 2.23 billion units per annum, the plant generated 1.32 billion units in 2015-16, the director general audit informed PAC.

He said the power plant could not run at full capacity due to installation of a low capacity furnace oil treatment plant.

Power Division Secretary Yousaf Naseem Khokhar said the issue had been resolved as the plant was being converted to gas.

PAC was informed that Mehmood was MD of the project, but he was now serving as secretary of the Punjab Agriculture Department. “After destroying the Nandipur power project, he will now destroy the agriculture sector in Punjab,” remarked Shah.

Being among favourite officers of the Punjab government, Mehmood had been decorated with Tamgha-e-Imtiaz for his ‘untiring work’ as managing director of the Nandipur power project.

The Express Tribune had reported in 2014 that Mehmood had been hired in violation of the laid-down procedures. Not only that, the finance ministry approved a project allowance for him that was 1,600% higher than the permissible one.

The 525-megawatt Nandipur power plant remained a troubled scheme since its inception. The National Accountability Bureau (NAB) has already completed an investigation to determine reasons behind the surge in project’s cost from Rs22 billion to Rs57 billion.

The NAB Lahore region office has completed its investigation and sent a report to the NAB headquarters for filing a reference in an accountability court, the additional secretary of PAC informed the chairman.

Agreement signed for Nandipur’s operation, maintenance

PAC on Thursday directed NAB to expedite the process to fix responsibility on those that were behind mismanaging the project.

NAB has been investigating the Nandipur power project scam for the last four years. The name of former law minister in the PPP government and few officials of his ministry were at the centre of NAB’s investigations for causing delay.

Other matters

As Pakistan loses one after another case in international tribunals, the PAC also took cognizance of the cases that the government was losing.

The chairman directed the power secretary to give a briefing on Karkey rental power plant case in which about $800 million worth of penalties had been imposed on Pakistan.

On August 22, the International Centre for Settlement of Investment Disputes (ICSID) awarded $800 million to Turkish company Karkey Karadeniz Elektrik Uretim AS in a damages suit it brought against Pakistan.

Politicians were always blamed for others’ failures and everybody should know who was behind mishandling the case that led to the imposition of over Rs72 billion worth of penalties on Pakistan, said Shah.

The power secretary informed PAC that Prime Minister Shahid Khaqan Abbasi had constituted a high-powered committee to look into the matter.

Lately, the London Court of International Arbitration has also issued a partial award against Pakistan, directing the country to pay around Rs11 billion which was claimed by nine independent power producers.

Published in The Express Tribune, October 13th, 2017.

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