Home » Govt seeks AG’s advice to resolve legal tangle of US $ 1.5 billion coal procurement

Govt seeks AG’s advice to resolve legal tangle of US $ 1.5 billion coal procurement

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The Cabinet Ministers, at its meeting on Monday, has decided to seek the advice of the Attorney General to resolve the legal dispute concerning the $ 1.5 billion coal procurement, to avoid longer power outages from the latter part of October.

“The matter was discussed at length at the Cabinet meeting on Monday. It was decided to seek advice from the Attorney General and to make a submission to the Supreme Court highlighting the importance of a quick resolution to avoid adverse impact on the economy at large,” Acting Cabinet Spokesman and Minister Dr. Ramesh Pathirana said in response to a query at the post-Cabinet meeting media briefing yesterday.

Lanka Coal Ltd., called for tenders for the procurement of 4.5 million tons of coal and the revelations thereafter have stirred much controversy since then.

Ven. Dr. Omalpe Sobhitha Thero last week filed a Fundamental Rights petition in Supreme Court seeking an order staying the purported award made to a company incorporated in the United Arab Emirates (UAE) for the procurement of 4.5 million tons of coal to the Lakvijaya Power Plant.

The petitioner is challenging the decision of the Special Standing Cabinet Appointed Procurement Committee to award the coal tender to the Black Sand Commodities Company and subsequent approval issued by the Cabinet Ministers.

Sobhitha Thero maintained that the price per ton of coal for which the tender has been awarded to the Black Sand Commodities Company, is exorbitantly high, vis-à-vis the current Russian prices, thus, giving an unjustifiably and indeed unconscionable profit margin to the above company.

The Petitioner also said that Black Sand Commodities Company is not registered with Lanka Coal Company Ltd. as a supplier of coal.

Separately in response, Power and Energy Minister Kanchana Wijesekera also officially requested Committee of Public Finance (COPF) Chairman and MP Dr. Harsha de Silva to conduct an inquiry on the procurement of coal.

“False allegations levelled against the awarded tender have created questions on transparency and pricing. I hope COPF will expedite the inquiry,” Wijesekera opined via Twitter.

Last week, Public Utilities Commission of Sri Lanka Chairman Janaka Ratnayake warned that Sri Lanka might lose 900 MW of coal power generation due to the unavailability of sufficient stocks and the ramifications of it will have to be borne by the public with long power outages.

He said the remaining coal stocks are only sufficient till the last week of October and if the Government or the Ceylon Electricity Board (CEB) is not allowed to import, there is a high possibility that the plants will be forced into a shutdown resulting in long power cut hours.

“We need to ensure that the current power generation plan is not confused for the benefit of all citizens. We must procure sufficient coal at least by early next month for the sake of the public and the economy at large,” Ratnayake stressed.

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