LNG terminal contract: TIP appreciates PM Nawaz’s decision

TIP letter raises number of objections to proposed award of contracts.

Transparency International (TI) Pakistan has appreciated the Prime Minister Nawaz Sharif’s decision not to give his seal of approval on the LNG Terminal Contract.

“The PM is strictly following his declared policy of ‘zero tolerance for corruption’, and application of Rule of Law in Pakistan,” a letter dated March 20, 2014 says – referring to a news story, published in The Express Tribune on March 13, 2014, which reported that the premier refused to give his approval to the contract.

The letter – written by the TI Pakistan Chairman Sohail Muzaffar to the PM’ secretary – claims that Ministry of Petroleum and Natural Resources (MoP&NR) on the initiative of its secretary first tried to award the LGN Terminal Contract to Engro Corporation’s Elengy Terminal Pakistan Limited (ETPL) without going into tendering in July 2013 and recommended that the ECC should allow exemption from Public Procurement Regulatory Authority (PPRA) rules.

“In August a company ISGS, and not Sui Southern Gas Company (SSGC- the procuring agency) invited tenders, opened in October 2013, and only two bids were received. One bid was declared non responsive,” the letter says, adding that according to the PPRA Rules, a single bid could only be considered if the procuring agency had awarded a similar contract in current fiscal year.

The TIP letter raises a number of objections to the proposed award of contracts. It asks as to why the Ministry of Petroleum was insisting to award unsolicited contract for Fast Track Engro Terminal Project, at cost of US $30-40 million, why SSGCL was not allowed to invite bids, why the ECC approved the single bid of ETPL on 28-2-2014 when the ECC had rejected single bid of LNG Terminal on 30-3-2013.

“[These] are issues which are to be considered by the Prime Minister, the ECC and the Cabinet, to handle the LNG Terminal Project, before proceeding with this tender, as mis-procurement has been declared as cognizable offence,” it says.

Published in The Express Tribune, March 22^nd, 2014.