PAC stops variation pay to Chameliya contractor
KATHMANDU, JUL 02 -
The parliamentary Public Accounts Committee ( PAC ) on Tuesday ordered the Energy Ministry to hold the decision of the Nepal Electricity Authority ( NEA ) to pay variation charges to the contractor of the Chameliya Hydropower Project .
An NEA board meeting chaired by Energy Minister Radha Gyawali had decided to pay more than Rs 1.09 billion as variation charges to the project’s contractor last Friday. Disagreeing with the NEA ’s decision, the parliamentary panel had instructed the ministry in writing not to issue payment for the time being.
A Chinese company Gezhouba Water and Power Company is the contractor of the 30 MW project located in Darchula district in the far west.
Most of the lawmakers present at the PAC meeting on Tuesday morning had questioned the NEA board’s decision citing possible misuse of funds and insisted that an investigation be made before releasing the money to the contractor.
The project had been originally estimated to be completed at a cost of Rs 8 billion. The price tag was revised to Rs 12.66 billion around five month ago as the tunnel needed to be widened.
With the contractor demanding variation charges for delays caused to the project’s construction, the cost has now been inflated to Rs 15.06 billion which is almost double the original figure.
The project’s consultant had recommended to the NEA to pay Rs 1.23 billion as variation charges. The figure was whittled down to Rs 1.09 million after the government
hired another foreign expert to study if the recommended amount was correct.
Gezhouba asked for the additional money after a problem arose with the tunnel at the project site around two years ago. The problem was identified by an Italian company which studied the technicalities, and it had recommended redesigning it. As per the advice, a 470-metre section of the 873-metre tunnel has been widened.
The issue of variation costs surfaced after Minister Gyawali said she herself was confused and asked for logical justification from the staffers concerned during a meeting held to clarify concurrent issues and the ministry’s decisions. “I myself have not received any answers why the cost of the Chameliya and Kulekhani projects has increased,” the minister said.
However, lawmakers charged that the ministry had rushed to allot the amount to the contractor. Nepali Congress lawmaker Ram Hari Khatiwada demanded forming a committee to study the issue questioning the logic behind massive variation charge.
The ministry has said that they could not implement the NEA ’s decision after the formal PAC decision. “We have received a formal decision from PAC and we have to abide by it,” said Rajendra Kishor Kshatri, secretary at the Energy Ministry. However, he said that PAC should have thought about the impact of the decision and that the documents submitted by the ministry should have been studied thoroughly before reaching a conclusion.
According to Kshatri, the NEA board had decided to pay the money as the project was being held up due to the issue of the variation charge. “We made a speedy decision since we felt that it was necessary to get the project completed on time,”
said Kshatri. “Over 60 percent of the civil construction works have been finished.”
A senior NEA official said that it hadn’t received any formal decision as of Tuesday evening, but Kshatri said that the ministry would forward the PAC ’s decision to the authority on Wednesday.
The construction of the Chameliya Hydropower Project , which started in mid-January 2008, should have been completed by mid-June 2011. The deadline was extended by two years until mid-September 2013 following construction delays. The completion date was pushed back a second time by one and a half years due to further delays.
Source: The Kathmandu Post
