PM ignores AG’s warning, gives approval for LNG power project

PM ignores AG’s warning, gives approval for LNG power project

Prime Minister Mahinda Rajapaksa, in his dimensions as finance minister, presented a new note to Cabinet this week authorising the Ceylon Electricity Board (CEB) to sign up for a liquefied natural gas (LNG)/diesel-fired power plant without reference to the Attorney General (AG)

In an obvious dissimilarity to his earlier stance that the AG and the Chairman of the Public Utilities Commission of Sri Lanka (PUCSL) “must make necessary arrangements to grant the relevant legal clearance and regulatory clearance, respectively” before a letter of intent (LoI) is signed with the tender winner Lakdhanavi Ltd for the 300mw combined-cycle dual-fuel LNG power plant at Kerawalapitiya.

Chairman of the CEB is now cleared to issue the LoI to Lakdhanavi for the build, own, operate and transfer (BOOT) project and to sign the power purchase agreement for an impost of Rs 14.989 per kilowatt-hour (kWh).

The Attorney General had warned them these amendments also pose an “additional liability and risk” on the Government and the CEB.

Changes to draft project agreements made after bid closure would have “significant cost implications”, he added.