Matarbari’s rejoinder, our reply
Coal Power Generation Company Bangladesh Limited (CPGCBL) has sent a rejoinder to a story headlined "Matarbari Power Plant: Tk 93 lakh for two pipe cutters!" published in The Daily Star on April 1, 2024.
The rejoinder is full of technical issues that are unrelated to the story. Still, we are publishing the unedited rejoinder in full for our readers along with our response.
THE REJOINDER
The attention of Coal Power Generation Company Bangladesh Limited (CPGCBL) has been drawn to the above-mentioned news report published in your newspaper and online news portal on April 01, 2024. It is astonishment to see that your respected and popular publication has chosen to publish such a misleading report without bothering to check the facts of the case with the authority of CPGCBL. To begin with, 'Matarbari 2x600 MW Ultra Super Critical Coal Fired Power Plant' is one of the first track projects of the Government of Bangladesh and has been implemented by Coal Power Generation Company Bangladesh Limited (CPGCBL), a 100% government-owned company. On June 16, 2014 Government of the Peoples Republic of Bangladesh concluded a loan agreement with the Japan International Cooperation Agency (JICA), the financer of the project, to secure the power supply and to realize the policy of power source diversification in our country. On July 27, 2017, for the implementation of the Matabari 2x600 MW Ultra Super Critical Coal Based Power Plant, CPGCBL signed a contract with the Consortium of Sumitomo Corporation, Japan; Toshiba Energy System & Solutions Corporation, Japan; and IHI Corporation, Japan (STIC) who are jointly the EPC contractor of the project. Before, signing the contract, the EPC contractor was selected by an International Competitive Bidding process which was approved by the competent authority and as well as JICA. In order to monitor the EPC contractor's work and support CPGCBL to achieve the efficient and proper preparation and implementation of the project, CPGCBL appointed the company Matarbari JV Consultant [consist of Tokyo Electric Power Services Co., Ltd (TEPSCO), Japan; Fichtner GmbH & Co. KG (FICHTNER), Germany; Nippon Koei Co., Ltd. (NK), Japan; and SMEC International Pty Ltd (SMEC), Australia, on January 07, 2015, as owner's engineer which is also approved by JICA.
4. The project is being implemented by STIC under the provision of the EPC contract, and in that contract's price schedule, there is this item no. 6.6 'Plant, Water and Cooling system' which includes many items, including item no 6.6.11: 'Piping System of Entire Plant Water and Cooling System'. The news published on your esteemed daily is mainly on scheduled item named 6.6.11: 'Piping System of Entire Plant Water and Cooling System' of the said contract, which is on a lump sum basis. CPGCBL can only monitor the scheduled items, whether they are properly implemented within the quoted scheduled value. CPGCBL in this case only authorized to check whether the total item value is exceeded or not. Therefore, CPGCBL has no scope to verify the small item wise invoices as it is not Bill of Quantity (BOQ) item rather, this is a lump sum contract price. And for further convenience, the definition of lump sum contract is 'it is the form of contract in commercial transactions in which contractual obligations are undertaken for a fixed amount agreed upon as the contract amount. In principle, the amount can not be changed without agreement between the parties to the contract.
5. Despite the price variation among the smaller items, the total price of item no 6.6.11: Piping System of Entire Plant Water and Cooling System remains unchanged. Moreover, before every shipment of materials of the power plant, CPGCBL's owner's engineer 'Matarbari JV Consultant' verifies the credibility of the materials on behalf of CPGCBL.
6. The lump sum contract price for schedule 6.6.11 is payable in foreign currency JPY and USD. Furthermore, the mode of payment in foreign currency under is – Any amount payable to EPC contractor is disbursed directly from JICA to EPC contractor's (STIC) bank account in Japan.
7. When asked, the Japanese EPC Contractor (STIC), informed us that the invoice value for the concerned shipping is appropriately priced based on lump sum contract value. Besides, each Invoice value is priced within the Price Schedule amount and it will never be exceeded, which means STIC follows the EPC contract.
8. As described above, it is clearly noticeable that CPGCBL can only monitor the scheduled item whether they are within the quoted scheduled value on the basis of consultant certification and scheduled price of the item mentioned in the contract. Needless to say, it does no good to the reputation of your own publication to publish such misleading news. I hope you will publish this rejoinder to set the record straight and restore the image of CPGCBL and the Government of the Peoples Republic of Bangladesh as well.
OUR RESPONSE
The rejoinder almost entirely deals with technicality of the project, its components and the stakeholders involved for its funding and implementation – none of which was the subject of our report.
The rejoinder does not address the issue raised in our story, i.e., the abnormally high prices of some hand tools imported for Matarbari project with public money. It appears that the rejoinder rather seeks to avoid the issue of public spending and divert readers' attention with unrelated technical details.
To be clear, the very first claim in the rejoinder that The Daily Star published the story without checking the facts with the authorities is outright false. Project Director Abul Kamal Azad, who signed the rejoinder, has himself been quoted in our story. We quote him again:
"We think the prices are normal even though the customs said the prices are abnormal. The price may seem higher than the market price as the items were tailor-made upon a special order."
We also quoted the PD in our original story as saying that "the price is high as the two pipe cutters were made using special metal for use in the power plant."
Other than this untruthful claim that The Daily Star did not check the facts with the authorities, the rejoinder does not challenge any facts of our story.
We stand by our report.
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