Business Corruption

Unaware that HV cable project was awarded to another firm, claims STELCO

Development of a 50 megawatt power plant in Hulhumale by Dongfang Electric Corporation of China.

Development of a 50 megawatt power plant in Hulhumale by Dongfang Electric Corporation of China.

State Electric Company (STELCO) has stated that they had no knowledge that the Ministry of Environment and Energy had originally awarded the project to lay a high voltage power cable between capital Male and reclaimed suburb Hulhumale to China National Electric Engineering Company (CNEEC).

In a press conference held after the Anti Corruption Commission green-lighted the project, which it had halted last week with graft allegations, STELCO’s CEO Ahmed Zuhoor claimed that he had no knowledge that CNEEC was awarded the project by the energy ministry.

While the ministry, the initial project leader, had awarded the project to CNECC and informed the company in writing last November 13, the ministry had later revoked the decision 17 days after awarding it. The finance ministry had then tasked STELCO with awarding the project.

STELCO had awarded the project to another Chinese firm Dongfang Electric Corporation (DEC).

When asked if STELCO had any communication with the energy ministry regarding the project, Zuhoor replied that STELCO had had no reason to communicate with the energy ministry as it was tasked to STELCO by the finance ministry.

He added that the finance ministry was in charge of all the state-run companies while the energy ministry was a policymaker; hence, had the energy ministry instructed STELCO to follow a certain policy, STELCO would oblige.

DEC had proposed a bid of USD 38.6 million (MVR 567.4 million) without interest for the project, while another Chinese firm, China National Electric Engineering Company (CNEEC), had proposed USD 44.4 million (MVR 684.6 million) with bank interest.

Furthermore, Zuhoor also revealed that the energy ministry had shared with STELCO only the proposals of the international tender and was not directed to award the project to a specific party. He also stated that STELCO had reviewed both proposals and decided to award the project to DEC.

“We had no knowledge that the tender was halted or later revoked, we do not believe that tender prices are open to renegotiation”

Zuhoor also noted that it was against the best practice to renegotiate prices from international tenders and that STELCO had awarded the project after reviewing both proposals professionally.

According to STELCO, a 50-megawatt power plant being developed in Hulhumale by DEC would power a 132-kilowatt high voltage cable that would be laid between the suburb and Male. The cable would provide emergency power to Male as well as airport island Hulhule, which lies between the capital and Hulhumale.

STELCO is carrying out its fifth power project in Hulhumale, which will cost MVR 1.2 billion. The project is carried out in three parts, comprising of the establishment of six 8.9-megawatt generators, a fuel farm, and a water desalination facility.

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Source URL: Mihaaru-News

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