28 May, 2022


Yugadhanavi Power Plant Deal Is By No Means An Investment: Champika Ranawaka

The proposed transaction of the “Yugadhanavi” power plant is by no means an investment but a deal which is set to make Sri Lanka lose 410 million dollars said MP Patali Champika Ranawaka at a press briefing.


Explaining the fact and basis around the controversial transaction of the power plant and the trade union actions to be taken against it, the former minister explained further;

The general public is already facing immense difficulties at the moment. If they are to face power cuts and interruption of water supply due to trade union actions, their plight will be grimmer and worst. But, who is responsible for this crisis? These professionals and service personal of electricity board have acted with restraint since the break of COVID-19 pandemic. They have come to a point where they can remain silent no more.

Selling the “Yugadhanavi” and “Swabhadhanawi” electricity plants to USA and surrendering the Nation to a foreign power is not received well among the professionals. The agitation is a direct result of such acts against the sovereignty and integrity of the nation.

The President and the Minister of Finance is solely responsible.

There are many false arguments forwarded by this government.

This is a foreign investment ?

This is by no means a foreign investment. In fact this is a drain of local funds towards foreign nations.

There were two parts of the total debt of Ceylon Electricity board to the “Yugadhanavi” plant. One is the debt in USD and the rest is in rupees. The debt portion in USD is to be repaid in full by the end of this year. The remaining debt is only in rupees. So, what really is happening? In reality, the foreign party is not acquiring 40% of the power plant. It is the remaining outstanding debt of Ceylon electricity board in rupees that is being acquired by the foreign party. Approximately 225 billion rupees which is equivalent to around one 1100 million USD is to be repaid to the USA company by Ceylon Electricity board.

In summary, a debt to be paid in rupees is being converted in to USD. So this is not an investment. Approximately 410 USD will be transferred out of the country in the next 11 years according to the current rate of exchange. If the Rupee depreciate further against the USD, it will be even more.

A loan facility from the Asian Development Bank is to be granted to the tune of 140 million USD. Lanka Transformers ltd is to invest 70 million dollars. 35 million dollars out of that money is to be given to this company (NFE) and 49% of the shares of “Swabhadanavi” plant is also to be transferred to the USA company.

Its not only the shares of the plants, a share of the repayment / capacity charges by the CEB is also acquired by the NFE. In simple the company has opened a pathway to drain huge amounts of USD out of this country in the unforeseeable future.

This is cheaper than the CEB bid ?

If so the proper path is the said company to bid for the tender. If the procedure is followed all the required details about the background and the financial status of the company would have been revealed. In reality the said company is at the brink of bankruptcy. The company has not made any profit since its inception.

It has to be made clear that the “catch” of this transaction is not in the infrastructure development and the Liquid Natural Gas terminal (LNG). It is claimed that the MMBTU ( unit of gas) purchased via this pipeline is quoted at a lower price than the Chinese and Pakistan bidder.

It has to be emphasised that out of the total cost only 5%-10% is for the pipeline and the infrastructure. The rest of the cost (90%-95%) is within the price of the liquid Gas.

The crucks of the matter is right here in the purchase of liquid gas. A Korean company came forward once to and offered to build the pipeline free of charge.

The control of the gas supply is to be handed over to this company. The “Yugadhanavi”, “Swabadhanavi” in future and many more electrical plants of the CEB is dependent on gas supply. The total generated power of these [lant is in the tune to 1000 megawatts. The requirement of gas in the future for all these plants will be between 42 to 56 MMBTU. For the next 10 years this company will be the sole supplier of roughly 52 MMBTU of liquid gas to CEB plants.

According to the MOU between the said company and the Government, 5.5 USD is to be added to a unit price ( calculated by Henry Hub Natural Gas Spot Price) of gas supplied by this company.

The additional 5.5 USD is the profit generated by this company. 52 MMBTU x 5.5 USD is approximately 250 to 300 million USD. This company is set to profit that amount from this deal per year.

At a time of dollar crisis, this President, Prime Minister and the Mnister of Finance has committed an atrocity.

Sri Lanka has a huge gas deposit

Another one of such misleading statements is that we (Sri Lanka) has a huge natural gas deposit and that would be enough to repay all our debt.

But, in reality, no such gas deposit large enough to repay all our debts is yet confirmed within Sri Lankas territory. There are deposits around the country in various areas. In September 2011 a confirmed gas deposit was found close to Mannar. The deposit was big enough to power the “Yugadhanavi” and all other power plants of CEB. But, the Government is planning to purchase gas from Africa across USA.

What about the rhetoric on “National Economy” ?

The Natural Gas resource of the country is not something to be sold to a foreign company. This will cause the Natural Gas resource will be wasted and the country will lose money.

The energy Mafia

The Governor of California had to resign in 2002. Why ? because of a power crisis created by the power and energy mafia. The democratic party Prime Minister had to face the same fate due to a power crisis. He was locking horns with the LNG mafia. Mrs Prime Minister of Australia also lost her post because of the Energy Mafia. I also lost my portfolio.

This is yet again a surrender to the USA Power and Energy Mafia.

Sri Lanka is going to face an international crisis.

The selected bidder in the tender is a Chinese company. Instead of awarding them the contract the Government has given the American company the green light. This was not decided at the cabinet. This has not followed any procurement procedure. We are being framed between the two power camps of the world at the moment. The USA and India is on one side and China and Pakistan on the other side.

The impending trade union actions proposed by the CEB and other related trade unions are bound to cause further inconveniences to the general public. We regret such difficulties forced upon the public. But, the responsibility of such actions should be taken by the fake patriots of this Government; the president, the Prime Minister and the Minister of Finance.

The SJB Member of Parliament challenged the Government to hold a secret ballot in the Parliament to check the opinion of the house on the controversial deal and asses their popularity. (By PCRM)

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  • 0

    This is due to Rajapaksas playing one superpower against the other – mafia tactics repaid in kind. They are feeling mighty important,, but in the end are getting screwed east and west.

    All they have to do is get rid of Port City and give the Chinese something actually tangible to do. The oil and gas plants are very useful ones.

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