Implementation of Siddhirganj power plant to begin soon

FHM Humayan Kabir Implementation of the much-delayed Siddhirganj 450-megawatt power project is likely to begin soon as the World Bank at last has endorsed the government-selected contractor and agreed to make available fund for the project, officials said. Finance ministry officials said the bank has agreed to disburse its committed US$221 million fund for the Siddhirganj project and has assured the government of providing additional fund, if needed. Power Division officials said they have sought additional fund worth nearly $160 million from the gas-fired power project the generation capacity of which has been boosted. "Now problems relating to funding of the Siddhirganj power project have been resolved. We will start negotiation with World Bank in December for the necessary additional fund," an official of the Economic Relations Division told the FE. The state-owned Electricity Generation Company of Bangladesh (EGCB) has already selected a Spanish firm, Isolux Corsan, to build the power station in Siddhirganj, nearly 20 kilometres off Dhaka city, and received approval of its lender WB. In 2008, the EGCB first undertook a project to install a 350mw capacity peaking power station at Siddhirganj. The WB in the same year confirmed US$350 million loans for constructing the plant and installing power and gas transmission lines for the project. According to WB's suggestions, the EGCB changed the plant design and took up a new 450mw capacity combined cycle power station scheme at Siddhirganj. The power project faced setback in its initial stage of bidding in early 2009 when the lender refused to finance the scheme because of selection of a bidder that selected a black-listed German firm - Siemens, for supplying the generation plant. The global lender made commitment to provide US$221 million fund for the project and asked the state-owned EGCB to scrap the tender and invite a fresh one. The EGCB invited the second tender in October 2010 for the power generation project. But it did not find fully responsive contractors -- the two Spanish firms which submitted bids for the works. It then sent the bids to the WB stating the shortcomings of the two bidders. The global lender then advised the EGCB to relax its bid provisions and select one from the two as responsive to avert delay in the execution of the project which was held up for nearly two and a half years. As per instruction, the EGCB reviewed the bids again and recommended the Spanish firm, Isolux Corsan, to the lender for approval. Then it approved the firm for the project work. "Since the Siddhirganj 450mw project is one of the government's top priority schemes, we want to ensure its quick implementation," a senior official of Power Division said. "The contractor for installing the plant has been selected and we are awaiting approval from the government's highest authority. If it is approved we will award the work without any delay," he added.