No bar to re-tender for Patuakhali power plant: SC

The Appellate Division of the Supreme Court today (20 April) ruled that Singapore-based Yongtai Energy Pte Limited will not be able to proceed with supplying coal under a nearly Tk30,000 crore contract for the 1,320MW Patuakhali ultra-supercritical coal-fired power plant over the next five years.

A full bench of the Appellate Division led by Chief Justice Zubayer Rahman Chowdhury passed the order after hearing a leave-to-appeal submitted by Rural Power Company Limited (RPCL).

Following the order, there is no legal barrier to call for a re-tender.  

Earlier, on 11 July last year, "The Business Standard" published a report titled "How tender rules and a lone bidder stall a $2.5b power plant", highlighting irregularities in the tender process.

As a consequence to the report, the Power Division formed a probe body, which found evidence of procedural irregularities and subsequently cancelled Yongtai's tender, with authorities also instructing a fresh tender process for supplying coal to the power plant.

Challenging that decision, the Singapore-based farm filed a writ petition with the High Court, which stayed the government's order and allowed the company's tender process to continue.

Rural power's lawyer Sayed Mahsib Hossain said they later appealed to the Chamber Court of the Appellate Division seeking a stay on the High Court order.

The Chamber Court, however, granted the stay and referred the matter to a full bench of the Appellate Division for hearing.

With today's ruling granting leave-to-appeal, the Appellate Division removed all legal barriers to re-tendering the coal supply contract.

During the hearing, Attorney General Md Ruhul Quddus Kazal and lawyer MA Masum represented the rural power company while lawyers Mustafizur Rahman Khan, Mahbub Uddin Khokan, and Sagir Khan stood for Yongtai Energy.

According to the earlier TBS report, the RPCL-Norinco International Power Limited (RNPL) – the entity overseeing the project – has failed to appoint a long-term coal supplier despite issuing three tenders since January 2024.

Each time, Yongtai Energy emerged as the sole technically qualified bidder, consistently quoting prices deemed "unacceptable" by project authorities.

Previously, RNPL also floated a tender to procure one million tonnes of coal for trial operations of the plant.

Yongtai Energy again appeared as the only qualified bidder and is currently supplying coal sourced from Indonesia.

Officials familiar with the process have pointed to stringent tender conditions, questionable design elements, and suspected bias as key factors discouraging broader participation.

These concerns have effectively limited competition, raising doubts about the transparency and credibility of the procurement process.

Initially, RNPL aimed to begin commercial power generation between May and June 2025. However, the $2.54 billion plant – constructed by a Chinese consortium – remains idle due to the failure to finalise a five-year coal supply agreement, estimated to be worth between $50 million and $150 million annually.

Officials also noted that although 10 companies purchased tender documents in the third round, only four submitted proposals.

Among them, only Yongtai Energy met the technical criteria, further intensifying scrutiny over the bidding process and its overall fairness