4th round of tender for coal supply to Kalapara power plant cancelled

The fourth round of tenders called for long-term coal supply to a large coal-based thermal power plant in Kalapara, Patuakhali has been cancelled. It has been alleged that even though the scheduled time for the start of commercial production has passed, the RPCL-Norinco International Company Limited (RNPL) authorities are unable to complete the tender process for coal import.

Despite being repeatedly selected as eligible, a Singapore-based company is not being given a work order. On Tuesday, RNPL hastily sent a letter to the Singapore-based company cancelling the tender. However, no approval was taken from the RNPL board of directors in this regard.

According to RNPL sources, RNPL has a loan agreement of US$ 1.77 billion. This 14-year loan agreement has a grace period of four years. This loan agreement was signed in December 2020.

According to the terms of the agreement, the loan repayment will start six months after the completion of the project. In April this year, two units of the power plant were connected to the grid. And experimental electricity production has started. Although the power plant is ready for full production, it is running at 25 percent plant factor. Sources say that the plant will generate electricity worth $ 10.5 million per month. At least $ 7.5 million (excluding fuel costs) of electricity is not being produced from the plant at 25 per cent plant factor.

Sources said that during the fourth phase of the tender process, the then managing director of the power plant asked an official of the RNPL to send the number of an influential person related to the power sector of the current government to contact him.

Yangthai Energy was declared qualified in the technical evaluation of the tender called in the fourth phase. It was decided to declare the remaining three companies disqualified and return their financial proposals. After that, the tender evaluation committee held three meetings to evaluate Yangthai Energy's financial proposal.

The financial evaluation report recommended that Yangthai Energy's proposed coal price be considered affordable and accepted. But in the RNPL board meeting held on June 29, the power plant's Managing Director Salim Bhuiyan, acting as the Head of Procurement Entity, decided to send the proposal to the technical committee for re-evaluation.

The letter, signed by Senior Secretary of the Power Department Mohammad Hossain Patwari, was sent to RNPL Managing Director Dr Nazmus Sayadat. A copy of this letter has been sent to the Bangladesh Power Development Board and Finance Ministry.