Islamabad : May 16,2024 : Bullying behaviour of a top baboo of Power Division turned into a major reason to impose a fine of $ 120 million on Pakistan in a project whose total cost was only $ 37 million. An arbitrator appointed as per agreement under which Star Hydro Company Limited , a Korean company , had signed a Power Purchase Agreement (PPA) with National Transmission Distribution Company (NTDC) in 2012 for the hydro power project have a harsh decision against Pakistan for violating the terms of PPA in this case . The details of the dispute suggested that Star Hydro Power Company developed a dispute with NTDC on the tariff and payment issues and it lodged the complaint against NTDC with the arbitrator in London in 2021. Sources said despite lodging the claim with the arbitrator in London., Korean company made several attempts to sort out the dispute with the government of Pakistan amicably. A reliable source told NEWSMAN that Star Hydro Company ‘s management had two meetings with federal secretary , Rashid Mahmood Langerial and it intended to take its claim back from the arbitrator for a payment of $ 15 million in terms of its outstanding amount. These sources said Rashid Mahmood Langerial adopted extremely irresponsible behaviour with the Korean company’s team and ordered it to leave his office in no time . The secretary Rashid Mahmood Langerial ‘s furious reaction to the Korean company’s management demolished an opportunity of amicable solution on the dispute between NTDC and Star Hydro (Pvt) Limited . ” Rashid Mahmood Lungerial literally misbehaved with Star Hydro Company team in his office during the second meeting and ordered its members to get lost from his office in no time” , an eye witness to the incident told this scribe . The nature of the decision in this case shows NTDC ‘s arguments during the proceedings of the case were totally non-professional and it resulted in imposition of heavy fine of $ 120 million in the case which the claimant was ready to take back from the arbitrator for only $ 15 million . Read the following DISPOSITIVE and see how our top beaucrats are being in such an important cases .
The arbitrator ‘s decision said ” For the reasons set out above, the Sole Arbitrator:
(a) Declares that he has jurisdiction to hear Star Hydro’s claims;
(b) Declares that Star Hydro’s claims are admissible;
(c) Declares that the correct application of Schedule 1 of the PPA results in a final
Project Cost of 378,312,000 USD and a COD Tariff of 10.3632 PKR/kWh;
(d) Orders NTDC to pay Star Hydro the difference between what it has actually paid
since 8 November 2017 and what it would have paid from that date had the tariff
been set at 10.3632 PKR/kWh, less what it has actually paid, this difference to be
calculated as at the date of payment;
(e) Orders NTDC to pay simple interest at the legal judgment rate on the amount set
out at subsection (d) above, accruing from the 1 July 2024 up until the date payment
is made;
Orders NTDC to pay Star Hydro interest in respect of the invoices actually issued
which are late or outstanding, at the Delayed Payment Rate set out in the PPA;
Orders NTDC to pay Star Hydro the sum of 247,688.49 GBP in respect of the
arbitration costs, plus simple interest at the legal judgment rate accruing from 1 July
2024 until the date payment is made;
(h) Orders NTDC to pay Star Hydro the sum of 2,172,768.28 PKR and 1,867,251.5
USD in respect of Star Hydro’s legal fees, plus simple interest at the legal judgment
rate, accruing from 1 July 2024 until the date of payment”.
This case and penality of $ 120 million needs to be investigated and those who are responsible must be fixed.
NEWSMAN approached Power Division Secretary , Rashid Mahmood Langerial for his response on the issue . In his written response Mr Rashid Mahmood Langerial denied that he ever showed such behaviour in any meeting with Star Hydro Company ‘s team.
