Govt forms probe body over alleged irregularities in Patuakhali coal tender process
Yongtai proposes renegotiation of coal price if awarded work
The Power Division has formed a three-member probe committee to look into the alleged discrepancies in the tender process floated for appointing a coal supplier to the upcoming 1,320MW coal-fired power plant in Patuakhali.
The committee is headed by KM Ali Reza, additional secretary (Development Wing) of the Power Division. The other two members represent the Bangladesh Power Development Board and project operator RPCL-Norinco Intl Power Limited (RNPL).
The move follows a lead report carried by The Business Standard last Friday, 11 July, with the headline "How tender rules and a lone bidder stall a $2.5b power plant."
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In this report, TBS found that restrictive tender terms, questionable design choices, and strong suspicions of favouritism, appear to have systematically excluded other potential suppliers leaving a Singapore based company Yongtai Energy Pte Ltd as qualified bidder.
RNPL Managing Director Md Salim Bhuiyan confirmed the development to TBS today. He said following the report, the Power Division formed a committee to look into discrepancies that may have prevented wider participation of bidders in the tender.
He also said, "The committee will submit a report at the earliest possible time and recommend the next course of action."
Since January 2024, RNPL has issued the coal supply tender three times. Each time, Yongtai emerged as the only qualified bidder in technical evaluation, raising questions about fairness of the tender and the tender specifications.
Power division officials said the tender documents were framed in such a manner that suits only Yongtai, who is already supplying coal to Patuakhali 1320 MW power plant for test run.
Sensing the stringent terms and conditions, other potential bidders ultimately refrained from submitting bids, viewing the process as a lost battle.
Power, Energy and Mineral Resources Adviser Muhammad Fouzul Kabir Khan acknowledged the issue and said, "Following the TBS report, I have instructed the power division to investigate the issues raised in the report. In the next course of action, the power division will make some recommendations to ensure competitive bidding."
Yongtai meet energy adviser, defends bid, offers price cut
Amid the scrutiny, a delegation from Yongtai met with Adviser Fouzul Kabir and Power Secretary Farzana Mamtaz on Sunday at the Secretariat.
Yongtai's team also presented a letter to the adviser stating that the "tender process was fair and transparent and it became a qualified bidder following the due process."
During the meeting, the delegation pressed the adviser to award the supply contract in their favour, arguing that Yongtai had emerged as a qualified bidder by adhering to the RNPL's tender specifications and had not engaged in any unfair practices.
The Yongtai team visited the ministry at a time when the Power Division is likely to recommend launching a fresh bid for a coal supplier to Patuakhali power plant.
Yongtai also offered to renegotiate the coal price quoted in its tender if awarded the supply contract, a Power Division official said.
TBS also learned that, to convince the adviser, Yongtai used a friend of Fouzul Kabir who lives in Boston, USA.
When asked about Yongtai's proposal of lowering coal price, Fouzul Kabir said, "There is no scope to renegotiate coal price in the middle of the process. We will give a guideline to the RNPL on how to move forward regarding this tender."
When asked about Yongtai's attempt to use a friend to influence him during the meeting, Fouzul Kabir said, "Yes, Yongtai mentioned one of my friends as a reference – someone I studied with at Boston University."
"This will not influence my decision. We will decide on the coal supplier following the law," he added.
TBS contacted Xu Bin, managing director of Yongtai Energy, via Whatsapp for comments regarding the price renegotiation offer and reference to the adviser's friend.
In reply, he suggested sending the query via email which TBS immediately did. But, since filling this report at 9pm, TBS didn't receive any reply from Yongtai.
RNPL's managing director said, "RNPL board discussed the issue of renegotiating the coal price quoted by Yongtai in the tender earlier by comparing the coal price of other power plants now operational in the country."
