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LNG Purchase Sans Tenders

Jan 29, 2011 2:21:20 PM - thesundayleader.lk

Neomal Perera Source: Asia Tribune

Government of Sri Lanka (GoSL) plans to negotiate with Kuwait on a Government to Government (GtG) basis for the supply of LNG fuel for the proposed Sampur Power plant, Deputy External Affairs Minister Neomal Perera told this reporter on Wednesday.
When asked why GoSL doesn’t call for tenders, which is seemingly more cost effective than GtG contracts, Perera said that GtG contracts are long term, with the prices fixed, regardless of the vagaries in the market.
He was however not in a position to give what the tenure of the proposed contract would be.
“We are exploring two options,” Perera told this reporter. Either to have the plant powered by LNG or by coal, he said.
But LNG is cheaper than coal, Perera said.
He said that the power plant which will have a capacity of 600 mega Watts (mW) in the first phase, will be built over a five year period.
It’s a joint venture between GoSL owned Ceylon Electricity Board (CEB) and a state run Indian power utility.
Papers in this connection have been sent to New Delhi, said Perera.
On the question of what are the steps taken by the GoSL to strengthen relations with the West, the country’s top export market, which relations, currently are at a seeming nadir, he requested this reporter to make an appointment with him to discuss this issue further.
Such a request was made by The Sunday Leader by e.mail on Wednesday.
At the time of writing no such appointment had been given.
He further said that Sri Lanka’s imports from Kuwait are marginal, except perhaps, when the occasional contract is signed for the supply of petroleum fuels.
Sri Lanka’s major exports to Kuwait are tea and its housemaids.
Perera further said that Kuwaiti assistance has been obtained to build bridges in the war ravaged northern and eastern provinces of the country.