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LNG project: China-Pakistan company out, India in

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The Government has decided to cancel a tender awarded to a China-Pakistan consortium to supply Liquefied Natural Gas (LNG) and lay a pipeline network after being selected through an international open competitive bidding process and instead consider an offer by an Indian company.

The China-Pakistan Engro Consortium was selected last year as part of a step towards reducing the cost of power production.

However, last Monday, Power and Energy Minister Kanchana Wijesekera submitted a Cabinet paper titled “Revisiting the National Energy Policy Related to the Development of Natural Gas Infrastructure in the Country,” to suspend the ongoing LNG procurement process.

Accordingly, the suspension covers the Development of a Floating Storage and Re-gasification Unit (FSRU) off Kerawalapitiya on a Build, Own, and Operate basis and a compatible mooring system on Build, Own, Operate and Transfer basis. It also covers the associated projects – the development of Offshore and Onshore Re-gasification Liquefied Natural Gas (RLNG) Transmission Pipeline Network with an Onshore Receiving Facility (ORF) and an associated System from the Floating Storage and Re-gasification Unit (FSRU) to existing and future Kerawalapitiya and Kelanitissa Power Plants on Build, Own, Operate and Transfer (BOOT) basis.

After following the proper tender process, the Cabinet-Appointed Negotiating Committee (CANC) in August last year granted approval to award the tender to the Engro Consortium.

Accordingly, although the Power and Energy Ministry had to submit a cabinet paper to enable the tender to be awarded thus, the ministry delayed the process, Ministry sources said.

The Sunday Times learns that the process had been delayed as the Indian government strongly objected to awarding this tender to the China-Pakistani company.

However, finally, the subject minister had requested cabinet approval to suspend this officially permitted tender, under these circumstances.

The Ministry had instead attempted to award this tender to Petronet LNG Ltd. of India, as an unsolicited procurement, but since the company did not have any experience regarding FSRU, the ministry had rejected the request and said if the Indian government supported the company, they would be able to supply LNG in containers.

“This will badly hamper the investor confidence and no genuine investor will come forward in future to this country,” the official said.

A Ceylon Electricity Board (CEB) top official said, “It will be a costly solution as there would be no competition, with prices being determined by the Indian company”. He said it could have an impact on the electricity tariff which would be increased and all costs would be passed on to the consumers.

The CEB’s Least Cost Long Term Generation and Expansion Plan (LCLTGEP) (2018-2037), which was approved by the Public Utilities Commission of Sri Lanka (PUCSL) in 2018, identifies the need for converting furnace oil and diesel power plants to LNG power plants to reduce power generation costs.

Accordingly, the CEB called for international competitive open tenders from February 18, 2021 to June 25, 2021, and two bidders came forward.

At that point, the US-based New Fortress Energy Company which gave rise to much controversy in 2021, had, without submitting an open bid for this tender, presented an unsolicited proposal to the government. The then Gotabhaya Rajapaksa government which supported this unsolicited proposal had even signed an agreement to sell 40% of the shares of the 300 MW Treasury-owned Kerawalapitiya Yugadhanavi Diesel Power Plant to the New Fortress Energy.

However, due to strong objections to the deal, the agreement had not been implemented up to now.

Against this backdrop, the CANC granted approval on August 4 last year to award the tender to the China-Pakistan Consortium, one of the two companies which had submitted proper bids for the tender.

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GoSL to develop unique Food Security Index for SL

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The government is currently prioritizing the development of a country-specific Food Security Index, with the goal of completing the initiative within the next three months.

This tailored index is expected to better reflect Sri Lanka’s unique food security landscape, addressing the limitations of global indices such as the Global Food Security Index (GFSI), which have been criticized for failing to capture the nuances of the local context. Policymakers have also noted that existing data is often insufficient or imprecise, making it challenging to develop effective strategies.

The proposed index aims to identify key national priorities and guide food security policy over the next five years.

As a first step in this effort, a workshop titled “Identifying a Suitable Food Security Index for Sri Lanka and Formulating a Strategic Plan” was held today (17) at the Colombo City Center. Organized by the Food Security Expert Committee in collaboration with the Food and Agriculture Organization (FAO) and the World Food Programme (WFP), the event brought together experts and stakeholders from across the sector.

Delivering the opening remarks, Senior Additional Secretary to the President Kapila Gunaratne emphasized the importance of the initiative, stating that the development of a precise, country-specific index is a vital step toward ensuring both economic stability and national food security. The workshop focused on the four key dimensions of food security; availability, accessibility, utilization and stability and explored how these can be incorporated into a comprehensive and practical national index.

Participants included members of the Food Security Expert Committee, such as Senior Professors Buddhi Marambe and Jeevika Weerahewa, along with representatives from various government agencies, academic institutions, the FAO, the WFP and the private sector.

(President’s Media Division)

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Several Opp. MPs walk out of Parliament

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Several opposition members of Parliament have walked out of the Parliament chamber today (June 17.) in protest over the actions of the Speaker of House, according to Chief Opposition Whip Member of Parliament Gayantha Karunathilleka.

MP Karunathilleka noted that several MPs including those from the Samagi Jana Balawegaya (SJB), walked out of Parliament after the Speaker refused to allocate time to discuss the on-going Iran-Israel conflict.

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SL – France sign key debt restructuring agreement

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Sri Lanka and France signed a bilateral agreement yesterday (June 16) in Colombo, marking a major milestone in Sri Lanka’s external debt restructuring process, the Ministry of Finance announced.

The bilateral agreement was signed by Mahinda Siriwardana, Secretary of the Ministry of Finance, Planning, and Economic Development, on behalf of the government and William Roos, Assistant Secretary, Multilateral Affairs, Trade and Development Policies Department, Directorate-general of the Treasury, on behalf of the government of France.

The statement by the Finance Ministry added that the government of France played a pivotal role in spearheading Sri Lanka’s external debt restructuring process, co-chairing the Official Creditor Committee alongside Japan and India.

The Ministry noted that the agreement would further strengthen the longstanding bilateral relationships between the two nations.

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