NEA awards Chameliya to KHNP

AKANSHYA SHAH KATHMANDU, April 28: Nepal Electricity Authority (NEA) has decided to award the 30 MW Chameliya Hydroelectric Project (CHEP) in Darchula district to Korea Hydro and Nuclear Power (KHNP) on shaky grounds. The decision taken by the NEA board on April 23 awards KHNP the contract of around Rs 4 billion for the electro-mechanical, hydro-mechanical and 132 KV transmission line construction work. The KHNP is presently facing a corruption scandal erupting from its dealings with a California-based valve manufacturing company for the purchase of valves for its power plants between 2003-07 (The Korean Times, February 8). The kickback-for-contracts case may ultimately lead to the collapse of KHNP, thereby leaving CHEP in limbo. “The Ministry of Water Resources, NEA and other concerned government bodies awarded the contract only because the project is financed under the Korean government´s soft loan scheme,” a Nepali private investor told myrepublica.com on condition of anonymity. Moreover, the process of selecting the contractor aroused controversy after KHNP ended up as the only bidder. The bidding price in February was about Rs 1 billion in excess, according to the source. “The amount could have been reduced, but NEA turned a blind eye to a letter and reports sent by another Korean Company - Samsung C & T, citing a downturn in the cost of materials,” the source added. Samsung pulled out of CHEP citing excessive rise in the cost of the project, leaving KHNP the sole bidder. Interestingly, KNHP was not qualified as a bidder as the tender document clearly mentions that the bidder must be a ´contractor and must have carried out two similar contracts within the last 10 years.´ KNHP is not a contractor but a subsidiary of the Korea Electric Power Corporation, a utility company similar to NEA. The project in-charge at CHEP, Keshav Bhatta, declined to comment to myrepublica.com about KHNP´s profile for the last 10 years. He, however, informed that the ´agreement is yet to be signed.´ Heon-Chul Jung (who was on the KHNP technical assistance team) was also a member of the team visiting Nepal during the signing of the loan agreement between the Government of Nepal and the Economic Development Cooperation Fund (EDCF) Appraisal Mission of Exim Bank of Korea. Later, KHNP became the sole bidder in the tender. akanshya@myrepublica.com
Published on 2009-04-28 00:00:01 http://www.myrepublica.com/portal/index.php?action=news_details&news_id=4397