Irregularities noticed: SC bars govt from awarding LNG import contract

SC says multibillion-dollar deal to remain frozen till suo motu case is disposed of.

ISLAMABAD:

The country’s top court has barred the federal government from awarding the over $46 billion Liquefied Natural Gas (LNG) import contract to any bidder till the final disposal of a suo motu case regarding irregularities in the process adopted in awarding the contract.

On Monday, a three-member bench of the Supreme Court adjourned the hearing of the case till March 18 and directed the secretary of the ministry of finance, secretary of the ministry of petroleum, managing director of the Sui Southern Gas Pipelines Limited (SSGPL), representatives of Engro Pakistan – a private company interested in the contract – and managing director of the Public Procurement Regulatory Authority (PPRA) to bring relevant records before the bench on the next date of hearing.

Taking notice of a news report published in The Express Tribune on Sunday, Chief Justice Iftikhar Muhammad Chaudhry took suo motu notice after reading a report that revealed authorities were avoiding the lowest bidder in awarding the contract for import of LNG.

In 2010 the Supreme Court had ruled that transparency and public procurement rules should be observed completely in awarding the contract for LNG imports.

During Monday’s proceedings, the court observed that according to the media the Economic Coordination Committee (ECC) had failed to take a decision on awarding the multibillion dollar contract for import of 400 million cubic feet of LNG and had left the matter to the Federal Cabinet to take the difficult decision.

An immediate meeting of the Federal Cabinet was likely to be convened early next week to resolve the controversy after some members of the ECC questioned the summary submitted by the petroleum ministry to declare the Pakistan Gasport consortium as the lowest bidder after pronouncing another bidder as “non-compliant”.

The chief justice said to the counsel for SSGC, Anwar Mansoor, and Salman Akram Raja of the Ministry of Petroleum that the present government had successfully completed its tenure therefore it was not suitable to put the incumbent cabinet into trouble. He proposed that the decision could be left with the next government to decide the matter.

SSGC Board Chairman Waqar A Malik had tendered his resignation on March 3, 2013 after the board was asked to declare Gasport Consortium as the successful bidder for the huge contract.

He complained that even though Engro Terminal had quoted two separate benchmarks for the LNG import price, its final bid price calculated by the SSGC’s bid committee was on the lower side when compared with Gasport’s.

Published in The Express Tribune, March 12^th, 2013.