A three-judge bench comprising Chief Justice Iftikhar Mohammad Chaudhry, Justice Chaudhry Ijaz Ahmed and Justice Ghulam Rabbani had taken notice of a news report about the contract for Mashal LNG project awarded to French firm GDF-Suez. According to the report, the lowest bid jointly offered by Fauji Foundation and multinational energy firm Vitol had been ignored by the petroleum ministry.
The bench, with the consent of counsel for parties, suggested to the federal government's representative to seek instructions from Prime Minister Yousuf Raza Gilani for moving a fresh summary to the Economic Coordination Committee of the cabinet.
“In view of the importance of the matter will it be possible that the petroleum ministry put up a new summary before the ECC for considering the case of 4-Gas, a Holland-based consortium, for the Mashal LNG project and on the basis of the same a fresh decision be taken for awarding the contract to parties which were declared qualified by the consultants, Potent and Partners,” the court said in its order.
Senator S.M. Zafar, the counsel for the government, will inform the court on Wednesday if it would be possible for the ECC to also consider Fauji Foundation and Vitol for a short-term supply of LNG or take a decision about their fate independently.
“Earlier decision of the ECC agreeing to award the supply of LNG to any firm (GDF-Suez) shall be of no consequence and will not give rise to claim by any party on this behalf,” the order said.
The court was dismayed at the conduct of senior officials of the petroleum ministry for keeping the ECC in the dark and said the government had suffered a lot because they had created havoc and done everything in a careless manner.
“We will not allow any one to play with the fate of the country just like that,” the chief justice warned. Earlier, S.M. Zafar and Abdul Hafeez Pirzada, appearing for GDF-Suez, informed the court that they had consulted the people concerned at all levels in the light of earlier observations of the court.
Petroleum Secretary Kamran Lashari read out a statement which said the ministry was willing to take the matter to the ECC again. The ministry also agreed to take the Fauji Foundation-Vitol proposal as an independent matter for the short-term supply of LNG.
Hafeez Pirzada requested the court to clear the name of his client which had been defamed for causing a loss of one billion dollars to the government. He said that if the matter was resolved in this manner then the allegation of wrongdoing by the French firm or the alleged loss to the government be expunged.
GDF-Suez, Mr Pirzada said, had drilling rights of 70 million tons of LNG and could supply 3.5 million tons of gas to Pakistan for 20 years, which when converted would provide 3,600MW of power to the energy-starved country.
He said that in case of a re-bidding the country would have to pay much more. “Therefore, to accuse the company of indulging in corruption is obnoxious to any human mind,” he said.
“Then the court has to decide the matter on merits,” the chief justice observed. He said the court was only concerned with the transparency aspect because the letter written by former finance minister Shaukat Tarin and admitting his mistake by mentioning the process lapse was quite alarming.
“In my personal view there was a misconception in his (Mr Tarin's) mind because then he had detached himself from the process by resigning,” Mr Pirzada said.
Earlier, Barrister Syed Ali Zafar, the counsel for Sui Southern Gas Company, argued that the Mashal project was an integrated terminal meaning that supply, storage and re-gasification of LNG to be conducted by developer 4-Gas.
“The 4-Gas has proposed the names, among others, of GDF-Suez for the LNG supply and the government negotiated and discussed the terms with them. The negotiated terms for supply of LNG with GDF-Suez were approved by the consultants and a summary was then taken to the ECC,” Barrister Zafar said.
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