LCC chairman drops bombshell

“We changed qualification criteria during the tender process”

Answering to an issue raised by MP Harsha de Silva – Chairman Public Finance committee and giving an interview to a media about countries biggest ever tender to procure 4.5 million metric tons of coal for a value of 1.5 billion USD , LCC Chairman has admitted that standing Cabinet appointed tender committee (SCAPC) changed the qualification criteria of the bidders, after shortlisting the qualified bidders and after the pre bid meeting on 28 th July. Tender process started on 21st July with Lanka coal shortlisting the eligible bidders and inviting them to bid for a two-year requirement of coal for Lanka coal company. Controversy is brewing over how a company which was not among the initial eligible bidders list became the successful bidder and won the bid finally. Black Sand Commodities of Dubai, claimed to be a sister company of a Russian company named Suek AG won the tender even though its name was not in the list of eligible bidders.

However Suek AG name was there in that list. According to LCC Chairman’s revelation, LCC previously had 25 registered suppliers but only 7 of them applied for re registration due to various reason and only three of them participated for the pre bid meeting. As per LCC chairman SCAPC did a change of qualification criteria of bidders, after the pre bid meeting on 28 th so as to accommodate joint ventures and sister companies. This is because it wanted more participants for the tender. As per him, previous to this amendment sister companies were not treated as eligible suppliers, unless they themselves met all the qualification criteria to be an eligible bidders. This change which has been introduced while the tender process is on by the SCAPC , chaired by R W R Pemesiri, former RDA chairman and secretary to the ministry of Highways , has raised serious question as to the validity and transparency of entire tender process pertaining to the biggest ever commercial transaction of the country.

It raises various questions for which now LCC and the said SCAPC have to answer, such as (1) Can the qualification criteria be changed during a tender process? (2) If it can be done, then what is the process as well as formalities and approvals for executing such a change and did LCC followed those? (3) Did LCC inform all other 25 previously registered suppliers about this change because it is claimed that this was not done only to facilitate one party but to attract more bidders for the tender? (4) If it was informed, when was it informed to the registered suppliers? (5) why is it that the LCC did not publish this change and kept it as a secret till various parties question it?

Industry sources claim that due to the magnitude of the transaction and controversies around Black Sand Commodities introduction to the bidding process, and specially due to the fact that Black Sand was the only bidder in the tender with a price proposal, the LCC must answer all above questions to the public ASAP prior to entering into any further agreements with Black Sand .