The future of the Bibiyana 1 gas-fired power project deal hangs in balance as the government may go hard-line after the initiator of the project, Summit Group failed to meet the deadline on several occasions, said power division officials.
A meeting involving the Prime Minister’s Energy Adviser Tawfiq-e-Elahi Chowdhury, State Minister for Power and Energy Muhammed Enamul Huq, Power Division Secretary Monowar Islam and the project owner Summit Group Chairman Muhammed Aziz Khan was supposed to take place at the project area Saturday. However, the meeting was cancelled due to unknown reason.
Meanwhile, the site, along with Bibiyana 2 and Bibiyana 3, which is being built under the PDB, were visited by Power Division Secretary Manowar Islam, and PDB Chairman Md Abdul Wahab Khan Friday.
“The government is going to reach a decision over Bibiyana 1 soon. Nevertheless, work progress at Bibiyana 2 have been satisfactory and is expected to be operational by next August. Construction work at Bibiyana 3 will begin next month,” Monowar told the Dhaka Tribune after the visit.
Summit Group had signed a Power Purchase Agreement (PPA) with state-owned PDB on May 12, 2011 and deposited the proposed security money of $3m for the Bibiyana 1 project.
Summit missed several deadlines, with the latest on April 30 and is yet to release any fund on the project.
The Power Cell, which is supervising the Bibiyana 1 project, recently sought permission from the government to encash the security deposit.
“Summit has been asked to seek judicial help over Bibiyana 1, as the government is planning to cancel its project agreement,” said a highly placed power division official requesting anonymity.
“Though Summit has sought three to four months more to mobilise funds for implementing the project, the government is less likely to listen to its request and might carry out the project itself.”
Summit Bibiyana 1 Power Company Limited (SBPCL 1) and Summit Bibiyana 2 Power Company Limited (SBPCL 2) were incorporated in Bangladesh on December 9, 2010 and December 21, 2010 respectively, as joint-ventures of Summit Industrial and Mercantile Corporation (Pvt) Limited and GE Energy LLC, a wholly-owned subsidiary of General Electric Company.
Together they were supposed to build the 341MW combined cycle gas-based power plant at Bibiyana of Sylhet. The simple cycle of the plant was scheduled to be commissioned in December last year and the combined cycle in December this year.
It obtained three independent power producer (IPP) projects: Bibiyana 1, Bibiyana 2 and Meghnaghat 2 – each having capacity of generating 335-341MW.
Meanwhile, the Power Development Board has signed a deal with Marubeni Corporation of Japan and Hyundai Engineering & Construction Co of South Korea to build a 399MW power plant at Bibiyana 3 and its full operation will commence in September, 2015.
On June 4, the government approved the construction of 400MW Bibiyana 3 combined cycle power plant project.
