Handing over a significant share of the country’s energy sector to a foreign company would jeopardize the country’s national security says JVP leader Anura Dissanayake .
He said this in Parliament today (4th), asking a question under 27/2 regarding the Cabinet decision to transfer 40% of the state ownership of the Kerawalapitiya Yugadanavi power plant to an American company called Fortress Energy.
While making that statement, the President also entered the House.
The full text of the question is below.
Question to be raised under Standing Order 27/2 – 2021.08.05
I want to draw the attention of this House to the dangerous situation that could affect the country and the people due to the transfer of ownership of power generation in Sri Lanka to foreign companies.
It was recently reported that the Cabinet had approved a Cabinet Memorandum, which will adversely affect the security and economy of the country. The same company had reported that the Secretary to the Ministry of Finance and the New Fortress Energy American Company had signed a preliminary policy agreement on energy supply following the Cabinet Memorandum. Accordingly, the American company will be entrusted with constructing a floating gas depot, pipeline and gas filling terminal to supply gas to the Kerawalapitiya ‘Yugadanavi’ power plant.
The ownership of the Kerawalapitiya Yugadanavi power plant is to be divided between several institutions. The Treasury, the Employees Provident Fund, the state-owned LECO and the state-owned Lanka Transformers Company are the shareholders. However, in parallel to this construction, 40% of the state ownership of the Kerawalapitiya Yugadanavi power plant is to be handed over to the American company.
This is even though, according to the agreements with the CEB, the CEB should wholly own the Yugadanavi power plant by the year 2035.
It is also reported that the American company has signed a memorandum of understanding with Lakdanavi, a subsidiary of Lanka Transformers, to set up another 350 MW power plant at Kerawalapitiya. The same American company is to supply gas for the power plant as well.
Accordingly, this American company New Fortress Energy will control the power supply of nearly 1000 megawatts from the power supply of Sri Lanka. This is a serious issue that endangers the national economy as well as national security.
Earlier this year, the Ministry of Power and Energy had called for international tenders to construct a gas pipeline system and a floating storage complex for gas storage at the Kerawalapitiya power plant. The tender period ended last June. It is learned that a separate staff had been recruited for the tender process, and a separate office had been opened. However, it is reported that steps have been taken to hand over the two constructions to the American Fortress Company through this Cabinet Memorandum.
It is also reported that although the gas required for the power plants had to be procured through tenders monthly or annually, the right to supply that gas has been given to this American company for 5 years without calling for tenders.
We hope that the Minister of Power and Energy will answer the following issues that arise in this situation.
Has the Ministry of Power and Energy called for tenders to construct a gas pipeline system for the Kerawalapitiya Power Plant and to construct a floating storage complex for gas storage?
If tenders were called, when? If that tender had been completed, when? So was any company selected for that? What is its name?
Was there a company called New Fortress Energy among the tender applicants? Was that company chosen?
Has it been decided to outsource the project to an American company called New Fortress Energy outside the tender process?
After an international tender is called and it is completed, can it be cancelled? Can handing over the same project to a foreign company by a Cabinet Memorandum be approved?
Have the Secretary of the Ministry of Finance and the New Fortress Energy American Company signed a Basic Policy Agreement? Will it be put before this House?
Is the government preparing to hand over 40% of the state ownership of the Kerawalapitiya Yugadanavi power plant to the New Fortress Energy American Company?
Has Kerawalapitiya Lakdanavi signed an MoU with the American Company for the construction of a joint power plant?
Has this American company been given the right to supply gas for five years without calling for tenders?
Is not the transfer of ownership of this power generation to a foreign company a step that endangers the national economy and national security?
What is the government stand on the transfer of energy rights in the country to an American company?
Anura Dissanayake
Member of Parliament
2021.08.04
