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Thursday, April 29, 2010

SC settles LNG case, hopes transparency will prevail

* Govt agrees to file summary with ECC for award of contract
* Bench says Petroleum Ministry did not pursue process seriously

By Masood Rehman

ISLAMABAD: Following an assurance by the government to revisit the process for the award of a $1 billion liquefied natural gas (LNG) supply contract, the Supreme Court on Wednesday settled the case with the hope for transparency to prevail in the future.

Headed by Chief Justice of Pakistan Iftikhar Muhammad Chaudhry, a three-member bench disposed of the suo motu notice, saying, “In view of the statement by the federal government, this petition is disposed of … with the hope that now the matter shall be considered in a transparent manner in both the Mashal Pakistan and the short term LNG supply projects”. Taking serious notice of irregularities, omissions and commissions in the process, the court’s order says, “We are compelled to make an observation that the officers/functionaries responsible for the [award of the contract] … are required to be dealt with in accordance with the law … we hope that the chief executive/prime minister would look into the matter accordingly.”

Petroleum Secretary Kamran Lashari accepted the responsibility of dealing with the matter, and said GA Sabri – special petroleum secretary – would not be associated with the process. While Sabri was given an opportunity, he could not defend his claim that there were no process lapses in the award of the contract cancelled by the SC on Tuesday. Earlier, SM Zafar, representing the Petroleum Ministry, filed a statement – compiled with the prime minister on board – and sought the disposal of the case.

The statement said that without prejudice to the stance adopted in court, “the government confirms that it shall file a summary on the Mashal Pakistan project with the Economic Coordination Committee (ECC) for a fresh decision on the award of the contract for the supply of LNG to 4-Gas; the developer declared qualified by the SSGCL, simultaneously put up a summary on the Fauji/Vitol proposal … for consideration and decision independently and separately from the case of Mashal; as a consequence … the ECC decision dated February 9, 2010, to award the contract for the supply to any person would not give any right to such a person to make any claim in this behalf and shall be of no consequence.”

The bench noted that a careful examination of the facts “reveals that the Petroleum Ministry and Sui Southern Gas Company Limited (SSGCL) did not pursue seriously the process for the award of the LNG supply contract for Mashal or the short term project, nor was a high order of transparency maintained … it is evident from the facts and circumstances … we also find from the documents made available that there is a price slope averaging from 0.145 to 0.155, which needs to be kept in view … it is the duty of the court to ensure that the Public Procurement Regulatory Authority Ordinance 2002, read with the Public Procurement Rules 2004, are adhered to strictly to exhibit transparency”. Following repeated requests by Abdul Hafeez Pirzada, representing GDF Suez, for an appropriate order protecting his position, the court noted that journalist Rauf Klasra – who broke the story on the irregularities in the award of the contract – had reaffirmed the stand he had taken in the news item. “Be that as it may, as determination on merits has not been made by this court to declare the involvement of GDF Suez, no order/observation is required to be passed in this behalf,” said the order.

Courtesy www.dailytimes.com.pk

 

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