CCoE approves to recover Rs 8.3b from Mian Mansha’s IPP
Aftab Ahmed
The Cabinet Committee on Energy (CCoE) on Thursday approved recovery of Rs 8.36 billion illegal gains by M/S Nishat Chunian Power Ltd owned by business tycoon Mian Mansha.
Power Division submitted a summary on Examination, Validation of Process of IPPs Agreement. The Committee after a detailed discussion approved the proposal that the agreements with 2002 IPPs finalized by the implementation Committee be reviewed in the light of NAB advice in the M/S Nishat Chunian Power Ltd case.
During an investigation, National Accountability Bureau (NAB) has established that Mian Mansha Power Plant had made illegal gains of Rs 8.36 billion.
This plant was set up under Power Policy 2002 along with several other power plants.
The audit committee on power had pointed out around Rs 1000 trillion excess payments by IPPs.
Following this report, the government had revised a deal with IPPs and claimed to save around Rs 836 billion through a revised deal with IPPs.
The government had paid Rs 90 billion to 35 IPPs under a deal. However, it had withheld payment to IPPs established under Power Policy 2002 due to an investigation National Accountability Bureau (NAB) launched.
Read More: NAB establishes Mian Mansha’s IPP for Rs 8.3b illegal gains
Sources said that NAB had informed Energy Ministry now that it had established Rs 8.36 billion illegal gains by the Chunian Power plant. The audit committee had established the same illegal gains by other power plants installed under power policy 2002.
Energy Ministry had informed to cabinet body on energy now that NAB wanted the government to recover the illegal gains from the IPPs including that power plant owned by Mian Mansha before proceeding further on the process of payments.
Now, Energy Ministry had also informed the cabinet body on energy that it should revise the master agreement signed with IPPs under power policy 2002.
NAB has establishing against M/S Nishat Chunian Power Ltd, due to the determination of tariff at the higher side.
NAB had further intimated that “Ministry of Energy if so desired, may proceed under power policy 2002 after securing the amount of loss caused to the state as established during the above stated NAB investigation in the best interest of the state.
Cabinet Committee on Energy (CCoE) on September 24, 2020, had formed an Implementation Committee for, inter-alia, implementation of MoUs.
Both forums of CCoE and ECC had mulled over the Report the implementation Committee had submitted.
They had Okayed the payment mechanism and agreements with IPPs in meetings held on February 8, 2021, and the cabinet had ratified it on February 9, 2021.
On a summary of the Power Division submitted on 5 May 2021, ECC decided and Federal Cabinet had ratified the decisions of the ECC.
ECC and cabinet had decided that government may process Payments to all IPPs (under Pre-1994, 1994, and 2006 Power Policy) accordingly to the signed Agreements except the IPPs under Power Policy 2002 until the conclusion of the NAB investigation.
Read More: IPPs Payment: CCoE to revise the agreement with 2002 Policy
They had come to know that the case of IPPs under power policy was under investigation of NAB. Therefore, they decided to withhold the payments to IPPs under Power Policy 2002.
The cabinet had also decided to approach NAB to examine and validate the process negotiations and signing of agreements including the Arbitration Submission Agreement.
The government had also asked any objection raised by NAB to the signing of these agreements and making payments to the IPPs of the 2002 Policy.
NAB in its letter had also informed about the agreements with all IPPs of the 2002 Policy saying that agreements with 2002 IPPs, the Implementation Committee had finalized, do not provide a deduction of illegal gain made by IPPs.
Keeping in view this background, the power division has now submitted recommendations to CCoE for approval.
The CCoE had established the Implementation Committee in September 2020. Power division proposes to assign it the responsibility of renegotiating the Master Agreements with IPPs established under 2002 Policy to cater to demands mentioned in a letter from NAB.
