28 October, 2021

Blog

CEB Engineers Reject LNG Deal As A Scam

By Kumar David

Prof. Kumar David

Suppose a Petrol Company (PC) offers you a fleet of taxis free, but on condition you buy your petrol from PC for 5 years. Suppose that the value of the taxi fleet is Rs 25 million but the cost of the petrol you will consume in the five year period is Rs 500 million. Whether you like it or not you must buy an agreed quantum of petrol from PC. This is a simple way to explain the conflict between Basil’s Finance Ministry and CEB Engineers. A Sinhala video by CEBEU President Saumya Kumaravadu provides an excellent summary:

An English statement can be read here

A US company called New Fortress Energy (NFE) will be the supplier of equipment, which consists of a floating regasification unit 5 miles out at sea and pipelines to bring gas ashore for the currently coal-fired 310MW West Coast power station (WCPS) Yuadhani which will be converted to gas and the diesel/gas fired proposed Sobadhanavi 350MW station; a total capacity of 660MW. Liquefied Natural Gas (LNG) has to be stored at extremely low (sub-zero) temperatures, transported in special tankers, stored at the floating terminal, re-‘gasified’ as needed and sent ashore. The BAIT is that NFE will buy 40% of WCPS for $250 million (investment), the TRAP is the compulsory purchase of LNG for both power stations and others taking gas from this facility. Sri Lanka has been trapped; it is infeasible to build a second FRSU and pipelines in a relatively small country.

The CEBEU says the CEB will incur fuel supply expenditure of $6 billion per annum. If NFE makes, say 10% to 15% profit on the sale of LNG, it will make a gross profit of $900 billion over the period. The deal stipulates that Sri Lanka must buy its LNG from NFE. You might say “What’s the problem we will have to buy it from somewhere?” And that’s the catch. Basil has entered into a Take-or-Pay contract for a certain amount of LNG. If CEB in any year (lots of rainfall say) does not need that much, too bad; it will have to Take-or-Pay even if it does not use it, like paying alimony to an estranged wife. The amount contracted is more than what the two power stations need. If the plants run at a likely 70% plant-factor their combined LNG-energy requirement averages about 34.5 MMBtu per annum according to my back of the envelope calculations. But the New Fortress website says it “will initially provide the equivalent of an estimated 1.2 million gallons of LNG (35,000 MMBtu) per day to GOSL, with the expectation of significant growth as new power plants become operational.” This is absurd as I will explain in next Sunday’s column. There will also be a fixed charge spread over the period by means of which NFE will recover its full investment costs.

Pricing could also be a problem. The price is Henry Hub, a famous LNG shipping point in Texas plus a nominal extra. Henry Hub price is ok, but often buyers shop around on the LNG spot-market and make good spot-deals ex-Singapore, the Middle East and from Japanese dealers. No more doing this in future except when we need more than contracted amount. Buying from Henry Hub is no problem, anyone can buy there anytime

This is not the worst, the next two points are worse.  A floating storage and regasification terminal and the associated pipelines are a huge investment. Once Lanka builds one, that’s it for a decade or more. These terminals are expensive and Lanka will neither need, nor be able to afford a second for a long time. Even India has only six such terminals in operation. In the meantime the CEB long-term generation expansion plan envisages the addition of about 3GW (3000 MW) of gas-fired generation in the period from now to 2037. LNG will become the bedrock of electricity production in the period to 2040 displacing coal (70% renewables by 2030 talk is just for a honk). The implication is that this country will be in the pocket of a US company for its energy security for the foreseeable future. The government is doing more to jeopardise natural security than Koran-intoning youthful hotheads!

My final point is that the September 2021 decisions of the Finance Minister and Cabinet are violations of proper conduct since alternative tenders were have been called. It rings alarm bells whether someone is making 10% on the deal. International Competitive Tenders were called by GoSL for an FSRU terminal and pipelines and bid documents for competitive bidding have been issued. Basil’s Ministry signed a secret agreement to sell 40% of WCPS New Fortress terminating all this in an unsolicited agreement that lacks transparency. The signing was reported in the New Fortress own website but not in local media. When SIRASA TV asked Power & Energy Minister Dulles Alahapperuma, he denied any agreement. Something is very fishy.

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Latest comments

  • 27
    1

    Prof what’s new ??? In Rajapaksa economy first you bring Chinese to built an antiquity for you and within months you get to know it’s of poor quality and non functional most days, After giving up complaining bring those Russian Engineers, who (only) are familiar with such antiquity to repair and make it functional. Still after realizing it’s a no go, in desperation get the Americans to provide an alternate option. How can this be possible ?? Not an issue at all in Lanka. Just tell those retarded, it’s all a U.S / foreign conspiracy , who are jealous of us.

    • 20
      0

      By the way Prof is that the button for LNG, what Basil is touching ?? or is he looking for the keys to his bank vault. Nice attire, looks like he in on his way to checkout the location.

      • 7
        0

        What we need is not development a la Lee Kuan Yew …….. but retribution/punishment/bringing-to-account of all these crooks for all theses daylight robberies a la Prabakaran!

        Hang them from lampposts.

        If these crooks are punished and made an example of ……. the country will develop itself ……. without all these crap iconic con-artists.

        How I wish there was a Sinhala Prabakaran!!

        Velumbahu Prabakara where are you when we need you most?

        • 4
          2

          nimal fernando

          “Hang them from lampposts.”

          Why?
          You must be watching too many American movies.
          Are you an admirer or follower American Hanging Judges?
          If you start hanging people who is going to hang the last person?

          • 2
            0

            “You must be watching too many American movies.”

            No, I’m watching history …….. how humanity progressed ……… by revolutions and violence.

            The greatest impact on humanity …….. the French Revolution ……. not the revolution per se but the aftermath …… the advent of Napoleon …… who unwittingly destroyed the European aristocracy and handed the power to the middle class.

            One can’t be averse to violence ……… were you bullied at school?

            I’m all for violence for a “good cause” ……… as long as someone else is doing the violence ……… :))


            Only retribution through violence will end the current cycle of looting of the public wealth by the SL politicians

            There are no moral men ……. only the fear of retribution keeps people moral ……….

      • 7
        0

        Chiv,
        .
        today it has been totally twisted by them and their stupidities. At the time, Hambatota harbour was leased, entire pingutthaya community protested as saying that the land is on sale then. Suprisingly, very same pinguththarayas stay as if their senses are fully impaired today. Can you imagine, how these men and women act time to time. Nobody else, this nation should be made responsible for stupid men to allow the loot from where they were supsended then.
        :
        Even Oppostion incl Tamil parties behave today as if they are totally withered. Muslims dont care much about though the minister of justice is FULLY raped by Rajapakshe clan for the political survival. In an arab country, if a muslim would have been that servile, no doubt the man would have been caught by STONE rains until being found death.
        In totally paralized srilanka, even your mothers would have been abducted by RAJAPAKSHES kalliya, nothing seem to work palpably.
        .
        Good riddance to our people, though my heart is overflowing with saddeness and helplessness when thinking of those – rest that always stood against MEDAMULLANA criminals.

    • 5
      4

      Professor Kumar is trying to pick on the minimum quantity requirement. In all sales contracts, there is volume discount or minimum quantity term apply. I am not sure what Prof. Kumar is talking about. You need to buy all the agreed quantity from seller. In many occasions, if you want to buy more, and if the manufacturer’s batch exceed the quantity contracted, he/she will give that remaining quantity to phony price, in order to clean there storage facility. But if you ask a small quantity more and he/she has to retool the assembly, they they will tell rocket price. Because production cost is a dependent variable on the volume manufactured, a manufacturer agrees to sell the units and price as one figure, that is the total cost. When unit change, price will change too.. If you tool a factory to 100,000 units and your client cancel with 50,000 then, you are stuck with the 50,000 units. Further, the generators going to come may come fine tuned for the grade of LNG going to be supplied. So there is a chance that the company cannot sell the reaming Gas. I need to read the contract myself to determine on KD’s talk.

    • 19
      1

      Rajapakse motto: “steal all you can while you can!”

      • 2
        8

        SarathP,
        Same with Ranil, his ‘Royal Gang’ and Foot Note ‘Kalliya’. These guys are worse because they came to power waving ‘Yahapalana’ flag.

    • 7
      0

      Dr KD,
      Thanks as always!
      .
      Leftists like Vasidewa N betrayed his soul but u remain exemplary. Salute u😐✌✌
      .
      But how many would respect it today in Rajapakshe,,’ hell/ formerly known as pearl in Indian Ocean?.
      .
      If the leadership had pure intention s to save the nation from Covid maraya, we could save the lives of 13000 that were killed so far. But ballige puthas never respected facts. 😡😡😡😡

    • 3
      0

      Our jokers stay as if their 5 senses are taken away forever.
      :
      With former pattapal hora being back to SLCB, the situation is worsening from PAN TO FIRE:
      .
      No different to what is being exposed in Lebanon.
      https://sayari.com/resources/governor-of-lebanons-central-bank-accused-of-financial-crimes-linked-to-dozens-of-companies/

  • 16
    0

    CEB Engineers Union and its President should be thanked for exposing what is not just a SCAM, but a total RIP-OFF!

    Prof: David has expanded on the issues involved,with his usual clarity.
    ………Something is very Fishy…….is the final line.
    Should we need to go any further? Basil is the man.
    This time around he will not make a hasty retreat back to the USA, but with the kick-backs he will head towards the Black Hole!

    • 0
      0

      ………Something is very Fishy…….is the final line……
      Made me think as this.
      The New Fortress Energy of W 19th St., NY. was established only on 6th June 2018. From 2017 there was one R in USA and who came back here. He again goes to US suddenly and no one knows why. On his return he becomes FM and within a few months of negotiation, hey presto, we have a deal.
      May be my imagination !

      • 0
        0

        My View ,

        Corruption is the Name for all our Games and Players ! More and more
        are interested , sought after , taken in , already involved , keen to get
        involved in the future , all to share kick backs ! One has to understand
        how we are so corrupt that No Return is possible under any kind of
        Rule on this planet ! American Political Scientists believe that erosion of
        Democratic values in America goes back forty years before they faced
        a melting point when Trump was elected ! Here we have two guys from
        one family , watched without any basic knowledge , what was unfolding
        in America and started to apply it in our country to satisfy their greed !
        Great Imitators we are by birth , dangerously now waling into all kinds of
        traps in order to buy more and more time to escape self destruction !

      • 0
        0

        MyView,
        US citizens are the best to make DEALS! That is there past time or hobby.
        Whenever or whatever circumstances, Golf, Dinner, Cocktails or high tea is immaterial. They have the knack.
        They learn the game well when in the US as residents and become good DEAL makers, with or without previous experience!
        It is very good to have such able people in this country and should be proud of that valued fact

        • 1
          0

          Dear M
          Not citizens but their whole concept of government is on deals brokered by the Washington Lobbyists. Even in the House or the Senate, they strike deals between Republicans and Democrats to push through legislation.

  • 15
    0

    There are lot of hard working patriotic people trying improve living condition our country. This engineer gave very good explanation about LNG gas market and interest of international companies. This is curse created by 60 lax of idiots who pave way to family rule.
    I am asking them now if you agree with selling assets of mother nation you should openly say so in a forum like this. Otherwise you should tell your Rajapakse brethren to stop this carnage. Otherwise it will be curse to your children in the future.
    Also you need to apologize to people who did not vote for robber brothers

    • 2
      20

      Jack,
      “Also you need to apologize to people who did not vote for robber brothers”
      —-
      By the same token those who allowed Muslims to carry out terrorist attacks, hand over Hambantota Port to Chinese for peanuts, co-sponsored UNHRC Resolution admitting Sri Lanka Armed Forces committed war crimes, robbed Central Bank twice in broad day light, signed ACSA and SOFA agreements without the approval from the Parliament should apologize to people who did not vote for the two dong keys.

      • 5
        0

        EE,

        “Signed ACSA and SOFA agreements without the approval from the Parliament should apologize to people who did not vote for the two dong keys.”

        Best of knowledge, the 2017 ACSA agreement has not been signed as government sought amendments to agreement submitted for signature and was not concluded.

        US requested to obtain the SL Defence Ministry approval with amendments!.

        ACSA 2017 Not signed.

        However, the ACSA agreement of 2007 different story, during MR’s tenure as President (1st Term), when clearly the US citizen was Defence Secretary. Expect him to be more conversant with ACSA 2007, more than anyone else!

        Appears you have been fooled R Bros Inc.

        Same ACSA became unpalatable to MR at the helm of the SLPP when 2019/20 elections were in process! Is it not deception? Fooling the SB voters and masses!!

        GMOA, Viyathmaga et all supporting them are good at manufacturing falsehoods to hoodwink the voters and come to power by ‘Hook or by Crook!

        You are not alone in this and the only person fooled by propaganda of SLPP!

        They SLPP exemplify this process and point the finger at others to fool SB voters. They cannot do that all the time and succeed.

        • 1
          7

          Mahila,
          “…the ACSA agreement of 2007 different story…”
          —-
          According to my recollection ACSA was signed on 4 August 2017 in secret.
          ACSA 2007 had a time frame of 10 years I think but Ranil’s ACSA was an ‘Open Ended’ agreement.
          —-
          Rajapakshes did not have to hoodwink the voters to come to power. Dong keys in ‘Yahapalana’ Government cleared the way for Rajapakshes to come back by allowing Muslim terrorists to carry out terrorist attacks. Muslim terrorist attacks backfired on Ranil. Poor chap!

      • 4
        0

        If Habantota was not leased, what was the option we had before us? .
        Selling wives pattapalhuru incl. Yours to any chinese or arabs? Because those sums received by the lease were totally used for all ” Rajapakshe loans” taken by stupid raja by wasting it for his luxurious life to the very manner recent trip to Bolongne /Italy is believed to be over 21000 euro only for the accommodation. People should be aware how much they waste for the maintenance of Rajapakshes 😡😡😡😡😡😡😡😡😡😡😡😡

      • 3
        0

        Eagle ‘dumb ass’ Eye, are you so thick loser? This whole topic is about CEB and the engineers opinion and how did you take this conversation to Muslims and Tamils? What an ass!!!!! Can’t someone take this bugger for treatment to Angoda?

      • 3
        0

        Oi! Muslims were set up, funded, and guided by Gotler’s gang of murders and Pissu Sira . Habantota was LEASED not sold. The money was used to PAYOFF the loan Meeharaka borrowed to build it. That does not amount to a pittance by any means. The central bank was not robbed twice by the same people. CABRAAL was the BIGGEST robber. The robbers thereafter set a trap into which Mahendran fell. The entire scheme was then exposed. The monies from the second robbery were recovered and the culprits jailed. My god your twisted convoluted rubbish is breath taking. These American agreements you refer to were first approved by Mahinda. One more thing the Singaporean government will NEVER allow Mahendran to be extradited. Do you know why? Go ask the buffoons who promised he will be brought back.

  • 13
    2

    Many thanks, Mr Saumya Kumaravadu,
    .
    How I wish every Lankan who has a little understanding of what is being done by the Rajapaksas explains like this in the clearest possible Sinhalese. I do my bit in Bandarawela.
    .
    I’ve listened intently to 20 minutes of the 28 minutes. I can’t listen any more because it is so boring, but this is how painstakingly all issues have to be explained, and in Sinhala.
    .
    I would never have imagined that a deal as sad as this could ever be mooted. What have Sinhalayo like Eagle eye to say about this? Was it for this that we rudely “nationalised” Shell, Caltex and Mobile soon after 1956? We were right to nationalise, but it could have been shorn of rhetoric. We want to now go ahead with this sort of sell-out, but the government doesn’t have the decency to acknowledge all the human rights violations.
    .
    What else will we sell, and allow foreigners to recover their purchase price within five years? The harbour is gone. Well, we could yet sell our public transport, – well, why not sell all the roads, and make us pay daily for their use. After all that is over, even all the air that we breathe
    .
    Panini Edirisinhe of Bandrawela (NIC 483111444V)

    • 2
      0

      S.M,
      “We were right to nationalise, but it could have been shorn of rhetoric.”
      Were we indeed?
      Even today, IOC is slapped with a tax on cheaper petrol that it imports from Singapore. This is to shield the inefficient CPC from competition. If the CPC didn’t exist, we could get fuel a little cheaper.

  • 14
    1

    “The government is doing more to jeopardise natural [national] security than Koran-intoning youthful hotheads! “
    Absolutely. It is this Rajapaksa Family Banditry Government that is a real threat to national security. They know it. That is why these diabolically evil Rajapaksas are at the moment spreading false rumours about the reemergence of the LTTE and Jihadists to divert the people’s attention. They simply don’t care if some more innocent people have to be victimized in false flag attacks to ‘prove’ their lies.

    • 2
      18

      Ajay Sundara Devan,
      “It is this Rajapaksa Family Banditry Government that is a real threat to national security.”
      —-
      BS!
      Tamil terrorists promoted by racist separatist Tamil politicians and Muslim fundamentalist extremists thriving with the blessings of few Muslim politicians are the real threat to national security.
      —-
      Rajapakshe family Government managed to get rid of Tamil terrorists and reduced the threat to a low level but it is not completely gone. If Rajapakshes came to power in 2015, this country could have avoided Muslim terrorist attacks. ‘Yahapalana’ Government turned a blind eye to Muslim fundamentalist extremism to get the support from Muslim politicians to survive in the Parliament.
      —-
      Threat to national security from Muslim terrorists unfolded from Easter Sunday attacks remain high because there are hundreds of Muslims brainwashed by Wahhabi Muslim preachers ready to kill non-believers of Islam in the society and a large stock of swords (3000?) imported by Muslims hidden somewhere in this country.

      • 1
        0

        The Rajapakshe family are nothing but greedy opportunists. Since you are their agent and you think you can come on this forum and spew all sorts of stupid theories in the vein hope that there are still people who will believe them let me repeat what has already been said about the Rajapkshes more times than I can count or remember.Mahinda was a poor broke idiot with no education. His job was assistant Librarian and the Sri Jayawardanepura Campus. He became an MP when Mrs B offered him his father’s old seat. He had no money to campaign. At some point he organized some goons to Rob a bank. He then proceeded to bump off the culprits one at a time to erase the evidence of the what he did. The last fellow was brought back to Welikada from Malaysia along with KP. The worst prison massacre was organized by his brother Gotler also a murderer to bump off this guy but he escaped by hiding in a cesspit. The record of swindle and murder is too long to recount here.

  • 17
    1

    Everybody has forgotten about Basil’s sudden USA trip prior to his appointment as a minister.

    • 2
      0

      Rw,
      Mlechcha men what ever they ve been doing since they are return is keep6 away from the press. Thst is why I accuse srilanken press of being more like over biased. 🤥🤥🤥🤥🤥🤥🤥

  • 9
    1

    The picture depicts a self-revelatory moment. Basil is saying, “Sorry … I know I stink.”

  • 14
    1

    Kumar David,

    If you are in Sri Lanka they will ask you to come to the CID in Colombo for an interview.

  • 6
    0

    “The CEBEU says the CEB will incur fuel supply expenditure of $6 billion per annum. If NFE makes, say 10% to 15% profit on the sale of LNG, it will make a gross profit of $900 billion over the period. “
    Isn’t something wrong with the sums there?

    • 11
      1

      It is so interesting to see the contortions the patriots are going through, trying to justify this deal. The difference between the UNP and the Pohottuwa is that the UNP sells assets but doesn’t make apologies, but the Pohottuwa lot, having come to power swearing on their dead mothers’ souls that they wouldn’t sell anything, have to indulge in theological gymnastics!
      Given the flip-flop history of this bunch of jokers, I wouldn’t be surprised if the deal is cancelled, like the East Terminal and the new LPG company Siyolit.

      • 3
        0

        old codger

        What happened to Nivard Cabraal who refused to borrow from World Bank however he has now accepted World Bank approved loan of USD 500 Mn financing facility to Sri Lanka, provided by International Bank for Reconstruction and Development (IBRD).

        Has he changed his mind?
        Has he made a respectable U turn?
        Is he going to eat his own words?
        Is he going to eat humble pie?

        He does not care as long as the clan get a substantial cut from the $500 million loan. The loan is meant for another Road project.

        Our friend Nimal Fernando maybe watching the clan with his lynch mob with a view to hang them high.

        • 2
          0

          Dear OC.
          If I recall, Kabarayas resolve was not to borrow from IMF as they require structural changes. The World Bank has no such requirement, and the World Bank Group works with developing countries to reduce poverty and increase shared prosperity, while the I M F serves to stabilize the international monetary system and acts as a monitor of the world’s currencies.
          BTW, I hold no handle for a crook called ANC, but just to correct record..

          • 0
            0

            So sorry. Above for Dear NV.

    • 5
      0

      OC
      When 10 – 20 % goes off by siphoning off for the cost of signatures of “assent” to the ‘Folly’, then it would reduce to $720 million!!
      you need not transcend international borders to reap the profits!!!
      and for 5 years and set for life!!!!
      1 Million Rupees in monthly pay check is insignificant!!!!!

      • 0
        0

        Mahila,
        Ah, but there is a big difference between 720 Million and 900 Billion, isn’t there?

    • 2
      0

      Ok, ok Old Codger 15% of 6 billion is 900 million.
      Older Codger

      • 0
        0

        Older codger,
        I know, I know, even my maths is fuzzy nowadays. And the auto-correct doesn’t help.

  • 8
    0

    One need not be a “Rocket Scientist” to comprehend that an “American Citizen” has, first to consider favouring another “American Commercial Establishment” when it becomes a “Business Deal”. That “Blood” is thicker than water. This “LNG Deal” is much more than a “Business Deal”, in that, there is the connected and “Hidden” aspect of our county’s “Security”. An “Americal Citizen” has “Pledged” to “FIRST” serve the “Interests” of his country before serving any other country, even though he/she is chosen to be the President (CEO) or the Minister of Finance of the country he/she is “Employed”. In that context, neither the “President” nor the “Minister of Finance” could be blamed for any “Favours” granted to America and her Commercial Establishments. The PEOPLE of Sri Lanka have voted “Overwhelmingly” to “EMPLOY” these two individuals – Nandasena Gotabaya Rajapakse and Basil Rajapakse as “President” and “Minister of Finance” respectively. The People have done a “Head Hunting Excercise” as done by many Commercial Establishments in securing the “Best” candidates to handle crucial operations.

    So in the end, those “Head Hunters” – the PEOPLE have no case to fight or grumble, other than to “SACK” both of them (along with many other Cohorts) to at least secure what is remaining as our “Assets”- both “Resources” and “Security” of the country.

  • 4
    2

    Sounds like China paid for Prof. Kumar, on his last trip to Hong Kong, for this essay. I read in the news today that the French Ex PM, Nicolas Sarkozy was slapped with a one-year prison term for overspending in his lost election in 2015. China paid the election expenses to the Old King in his lost election in 2015. It was Ranil who burned the CID investigation documents on that and forced Journalists Vamadevan & Dharshi out of the country for releasing the copies of this lost investigation. I looked for Prof Kumar to come here and talk about Sarkozy’s racketeering and his prison term. Sadly, he has fallen into his anti-American rhetoric, joining his hand with Lemon Puff, Communist Pakaya and Ganapathi Pillai. How many Zillions Rs are lost in Nuraicholai, Colombo Pong Cing, Hangbangtota deals alone, country’s sovereignty is another. How about Lankawe’s fake naturalization of farming and buying Chinese germs for $ billions? I guarantee if Lankawe buys additional LNG on the market, in competition to NFE, New Fortress is not going to bring down even one computer of Appe Aanduwa and if it does so, Aanduwa can sue it in American courts. Remember, China slapped $300m fines on Colombo Pong Cing & Pahadu Tower. Did Prof. Kumar know that those contracts had terms like that client paying for the delay of the contractor?

  • 2
    2

    Anyway, who needed these contracts for even to think to excuse the government paying penalties on those contracts? Are they something essential like electricity?
    This is a contract with a private company. It is not an exclusive contract, but there is a minimum quantity requirement. On the opposite side of KD’s argument, if the contract performs well, the company can probably be pressured to supply more on the contract price. If Lankawe cannot use all the gas, it can sell to urgent buyers, who run short on regular supply or who run out of dollar reserves. Private companies try to satisfy clients unlike China, which is repeatedly slapping on Lankawe penalty after penalty. This kind of resale deals can be negotiated even through NFE, bundling with some other give and take deals. Lankawe has no guarantee that it is going to have systematic rainfall. Further, the Government needs not to use all the water from reservoirs in the same year. After-all Prof Kumar has not shown anywhere the calculation of the electricity that is going to be generated in this plant is going to be excess for the country’s needs.

  • 1
    2

    “But the New Fortress website says it “will initially provide the equivalent of an estimated 1.2 million gallons of LNG (35,000 MMBtu) per day to GOSL, with the expectation of significant growth as new power plants become operational. This is absolutely meaningless talk. “Expectation of significant growth” is not the definition of minimum quantity that has to be bought. Professor KD is using it as a scarecrow to threaten the laymen. The important figure is what the minimum requirement to buy and what are the terms on the roll back quantities? In Lankawe, there are thousands, and thousands of villages are without electricity. If China doesn’t want the electricity for its project, why Lankawe cannot expand its services to local consumers? We don’t know if the NFE’s LNG is price jacked up like Chinese one $15. But it is not affecting Lankawe cutting down the gas emission, while Lankawe was making deal with China for Kerawalapitta to expand again with coal burners. This electricity and Gin- Nil Wala Ganga water is supposed to be used in China’s 5 Villages projects in Hangbangtota. We don’t know the price of electricity & water the Lankawe government promised to China. Learned professor has no idea on that so he is not talking about that.

    • 4
      0

      A few more details in Sunday 3 Oct column.
      Wow “Professor KD is using it as a scarecrow to threaten the laymen.” you say Mr Mallayuran. Well, well let’s see what happens if the contract goes ahead.

      Regret your comments from “If China does not…” up to “… the Lankwe government promised to China” are unschooled giggerish.

      • 0
        2

        “If China does not…” up to “… the Lankwe government promised to China” are unschooled giggerish. I didn’t know that you cannot take fast bowls, but sorry, I cannot go for spins as my word length is only 200, unlike your 1500. If something pricked and that is why you went below the belt insults, then the whole drama of yours is farcical. If your standoff is that Lankawe had not jacked up the price of a vial of vaccine to $15 or China is bringing electricity and water for Hangbangtota project from home, not going buy locally, then I can wait and see the strength of that statement until that becomes right or wrong.
        ‘well let’s see what happens if the contract goes ahead “ Sorry I don’t have to wait until Lankawe go ahead with the contract or cancel it like it did with Dole, to see what you did was only a cheap scarecrow job. Some commentators see that your arithmetic is flawed. But because I too make spelling mistakes and arithmetical errors, that is not my point. My point is simple; you ignored a vast amount of data needed to analyze, but not available to the public as an advantage for your scaremongering job.

      • 0
        2

        We don’t know what kind of investment the company (NFE) going to go for its 40% share in WPCS. We don’t know what is going to be the final format of WPCS. I don’t know if there is any provision in Lankawe to a foreign company own part in a government (utility) corporation. In they case, if WCPS becomes a publicly listed company, all KD’s talks are only just babble. The whole Western world leaves it to private utility companies to supply to citizens from telephone, power, water, electricity, steam, cable, and to internet services. It is a joke that KD is dying so hard to show this as Lankawe is sold to America because a company has a condition of minimum quantity of LNG purchase. Only, leftists’ extremely gloomy minds come to conclusions like that. Prof. KD’s writing reveals that he is not sure if the NFE going to enslave Appe Aanduwa or America going to enslave Lankawe. Here is a private company buying 40% share in a utility (WPCS), where we have no idea of what its registration is going to be in the end. If WPCS becomes a non-government corporation, then it will come under some scrutiny of SEC because NFE owns 40% of it.

      • 0
        2

        The frauds or illegal bribes to ministers will not be possible. From its end, NFE will not allow WPCD to do a Banda – Chelva pact on minimum quantity purchase, whether KD chest beating that it is trap or gentlemanly agrees that it is only a normal business deal. IF NFE exert undue pressure on any unagreed matters, Appe Aanduwa always can talk to American government to arbitrate on those matters. Certainly, the American government do that, irrelevant of Democratic or Republican government at that time. IF NFE defrauds anything that is legally signed, WPCS can file a legal suit in American courts. America is not a jungle law enforced wildlife sanctuary, Lankawe or China. After all these are possibilities, if anything KD hallucinates and gets scared then that part is below scarecrow techniques, it seems.
        “A few more details in Sunday 3 Oct column.” I will read it; but what is the point in you submitting that here? You wrote your babbling after you read it, or you are bringing it here now to defend your past babbling? I never expected a poor-quality work from you then coming back and vehemently defending it. It is so disappointing to see that you are dying so hard to defend Lankawe – China cutthroat commission dealings by coming to this by backdoor entrance.

  • 1
    2

    In total, there are no figures of total demand, supply, excess forecasted, prices agreed, water consumptions, reservoirs’ capacity, the electricity the government is now buying from private producers, possible new uses of generated excess electricity……………
    When the minimum quantity of LNG has to be bought from the company, and the electricity is going to be manufactured locally, then the important question is what is the efficiency rate of the generators that are going to be installed. That is something for the government engineers’ job. Are they good and same with the market standard or below the market rating, consuming excess gas? Further, the company owns only 40% of the electricity production, but supplying 100% gas, then the question is will the company equally level out its earning between the gas supply and electricity generation? This deal seems better for the company to stick on to the lower end technology to produce electricity. So, it would have been better to let the company produce the electricity (100% ownership) and supply electricity at competitive prices. Because the company has only 40%, it need not worry about profitable electricity production. In a real sense that is the know how a developing country like Lankawe needs from a developed country. Because of their foolish sovereignty talk, Aanduwa has a chance of goofing this side. Without any data in hand, Prof Kumar jumped in for an anti-American propaganda.

  • 4
    0

    What, the Power & Energy Minister Dulles Alahapperuma has denied any agreement with New Fortress Energy from the US.
    ~
    Dulles Alahapperuma must be a moron. Does he not realise listed companies are required by stock market rules to report any price sensitive information to the market. Accordingly, on the 8th August 2021, New Forest Energy reported to the market (in this case NASDAQ – ticker symbol NFE) that it has signed an Agreement with the Secretary to the Treasury and the Ministry of Finance of Sri Lanka. Click on this link for further details:
    ~
    https://tinyurl.com/vrn2fhd9
    ~
    No one in the right mind would deny an authoritative and factual information that is already in the public domain, unless they are of unsound mind!

    • 2
      1

      Good information, KP! Thanks.

      More likely Dulles Alahapperuma directed his lie at the morons who voted in his government; they’d believe it; facts have no bearing on those folks.

  • 7
    4

    Don’t know about all this but I am on the whole happy about first world institutions coming into the country.
    The general view is that CEB engineers are very corrupt-they are like our Customs- far richer than their salary could make them . How ?Ask the secretive power suppliers who corrupt government institutions and officials of the CEB.

    It is also well known that our electricity is the most expensive in Asia. A corrupt government institution providing expensive electricity to a poor nation !

    We have to change. How ?

    • 2
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      All were happy when China, Leader of the developing world walked in saying that, SL was on the threshold of modern Power generation which is evolving in SL, thanks to China. They opened their eyes only when they found that Chinese Coal Power Plant was a Misérables affair, breaking down more often than supplying reliable power!
      Will have to wait and see, what a dead horse, this First world Natural Gas terminal and powerplant will be?
      Or, it was only a good business to pay fat commissions! Time will tell!

    • 4
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      Deepthi

      I am with you. Corruption at every level in govt. activities is well known & CEB is one of many cash cows. Years ago, I was renovating my house & needed the power connection switch board shifted to an adjoining wall. No date was given & was told that it would take a several days but for a payment of Rs 8000, it could be done immediately. Although I am against such dealings in principal, time was at the essence, so I agreed. The job took only a few minutes & I paid the CEB workmen at the site after completion. Overall, it was convenient & hassle free. More recently, I was trying to sell the property & a buyer wanted a high voltage pylon in the garden (which had been installed during my great grand father’s time with no compensation given) shifted, so as to run along the boundary wall instead of across the property. The broker promoting the sale undertook to arrange with the CEB & I was told that it could be done for Rs 5m. ‘all inclusive’. Having no option, I agreed to pay the official cost of CEB, which was only Rs.1.8m & the rest after completion, which they grudgingly accepted.

      Cont.

      • 2
        0

        Cont.

        It is said that corruption trickles down from the top, so if this is happening at grass root level, what happens at the top when stakes are high is anyone’s guess. The CEB officials, the politicians & their cronies are nothing but a pack of wolves fighting over a carcass. Unfortunately, in SL today, whatever the govt. initiative, the vultures are there. It is the new culture.

  • 3
    0

    Prof David and or CEB Engineers .

    Can you check on the following.

    1. What was the original investment on West Coast and who invested .
    2. What was the total investment was it around 50 billion .
    3 Were there loans . How much and who provided. HSBC ? NSB ? EPF ?
    4 . Did the government provide security for this loan in the form of a guarantee.
    5. For the purpose of the guarantee did Lanka Transformers give their shares with a lien .
    6; Government never invested . And LTL got the dividends ,
    7. If the US company is getting 40 % the share of original shares plus long term debt ( bank Loans ) how much is this . Is it less than 50% .
    8 ., is this asset to be transferred to CEB after 25 / 30 years of which over 10 years have finished, At the end of 25 years the investor has no value .
    9, How much would it cost to put up a new LNG plant . Is it less than 200 million.
    10 Then why is New Fortress paying 250 m .
    11. Is it true that CEB called for offers for another plant and 12 bid documents, were collected and only one offer was received. Why was it.
    12. The more important question is why New Fortress is paying 25O when a new plant will cost less than 200

    • 1
      0

      Mr Sanipa,
      This is a job for CEBEU. I absolutely have no access to the records.
      kd

  • 2
    1

    It appears that my one-time electrical engineering prof has tripped in unit conversion. 660MW generation capacity at 70% plant factor will require 37,832 MMBTU per day. 1KWh = .003412 MMBtu.I think there was a rounding-off error in the NFE press release. It should 1.1 million gallons LNG (35,000 MMBTU)per day
    I am not sure why he places so much credence on Saumya Kumaravadu’s rantings. Kumaravudu is out of his league when it comes to energy trading. To put it bluntly, he will not know his ass from the hole if he fell in the. energy trading floor. Minister Gammanpilla claimed that it will be the lowest of Henry Hub or JKM(Platts) price. Prof is sadly mistaken when he claims that the cheaper prices can be obtained on spot market. To carry out this operation you need professional energy traders, which Sri Lanka does not have any. You do want a repeat of the oil price hedging fiasco.
    It is my understanding that West Coast power station (WCPS) Yuadhani operates on diesel or HFO and not a coal powered plant.
    One of the fiercest critic of CEB, an independent energy consultant Mr. Ranapalna (sp?) commented that $250 million is a good price for 40% shares, and the 35,000 MMBTU take or pay quantity for LNG is less than the amount stipulated in the tendered floated by CEB.

  • 3
    0

    Prof Kumar David, you say: “Something is very fishy”
    ~
    Oh my COD! All this fishy talk is making me feel EEL. No need for me to MULLET over the matter because we are of course talking of the Rajapaksas. The clan behaves as if Sri Lanka is their own PLAICE, and thinks any deal it makes is a BRILL investment for the country. After all, for the Rajapaksas Sri Lanka is their OYSTER.
    ~
    GR was a small fish in a big pond in the US. He is now a big fish in a small pond in Sri Lanka and is having a WHALE of a time misgoverning the country. While all this is happening, Sri Lanka is in deep water, and sinking.
    ~
    The Rajapaksas will keep on slipping through the net but your article has exposed the dubious nature of their rule. For this reason, the article has certainly warmed the COCKLES of my heart!

  • 2
    0

    This was how the ‘royal’ family made their money in the past – stashed away safely, somewhere.
    Same is happening in unsolicited deals to build (well functioning) roads and other infra structure, while there is no hurry, especially now, with the state of the economy.
    The Ten Percent (maybe more now) works very well.

    • 2
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      justice
      “The Ten Percent (maybe more now) works very well.”

      ten percent was ten percent nadesan,nirupama rajapakshe’s husband.Basil is not that cheap.he is higher in the family hierarchy and is also the bagman who distributes the everybodys shares abroad.20percent minimum 20 to 30 easily.peanuts is for monkeys.

  • 3
    0

    Basil is an uneducated Banda from the south. The bugger has nothing upstairs, zero education, no class but a PhD in thievery. What else this rogue can do when he lacks all the above qualifications…………………he needs to resort to theft as a way of putting food on the table, not only for himself, but for generations to come as the entire Rajapaksa clan are filled with Bandas with no education and no class.

  • 2
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    whenever mr.20 percent comes back into the scene these things start to happen.

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