OGDC ‘glossed over’ multimillion-dollar contract

Official says he ‘forgot’ to add project in the list sent to NAB.

ISLAMABAD:

In a list of contracts sent for clearing to the National Accountability Bureau, the Oil and Gas Development Company (OGDC) “forgot” to mention a multimillion dollar contract awarded to Jamshoro Joint Venture Limited (JJVL).

The contract regarding the extraction of liquefied petroleum gas from Kunnar Pasakhi Deep (KPD) field was awarded to JJVL on February 20, 2012.

Following media reports of corruption, NAB wrote a letter on May 3 asking OGDC to submit details of all the contracts worth over Rs50 million awarded since January 1, 2012.

The official document containing the list of contracts was duly signed by Azhar Chughtai, who is the acting general manager of the supply chain management department of OGDC. The copy of this document, which is available with the Express Investigation Cell, indicates that OGDC forwarded a seemingly tampered list of 14 projects awarded to different parties since January 1, 2012.

When asked why OGDC did not include the crucial project in its list sent to the National Accountability Bureau, Azhar Chugtai said since the contract awarded to JJVL is a “state-running contract, it does not fall under the category of projects sought by NAB.”

However, Chughtai then changed his stance and said he was willing to send the above contract to NAB. Asked why it needed to be mentioned separately, he said: “I had to rush to the airport to catch a flight to Karachi on some official business last Thursday and forgot to add the project in the list forwarded to NAB.”

The much sought-after LPG project of KPD was awarded to JJVL, which is owned by a Lahore-based tycoon.

Sources said the extraction contract states an abnormally high LPG processing price of $272 per ton and is being questioned by many quarters. They allege that its conspicuous absence from the list might be an indication of providing undue benefit to a private party.

Insiders also allege that other competitors were sidelined during the process of awarding this particular contract and that the proposed gas processing fees was accepted without any evaluation.

The Express Investigation Cell, in its story published on December 17, 2011, highlighted clear flaws and the possibility of pre-bid negotiations in the draft of the same project’s contract. However, instead of corrective measures, press releases were issued to downplay the matter.

Published in The Express Tribune, May 14^th, 2012.