January 17, 2007	Wednesday	Zilhaj 26, 1427

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HYDERABAD, Jan 16: Senior lawyer Abdul Hafeez Pirzada on Tuesday said that the Lahore-based Associated Group -- which had been given 20 years lease of Lakhra Power Plant (LPP) -- had been pre-qualified and it had been given first right of refusal much before bids including that of petitioner Habibullah Energy Limited (HEL) were opened.

Thus, he contended, leasing out or privatisation of LPP was not sustainable because Privatisation Commission Ordinance (PCO) 2000 had an overriding effect over all other federal laws.

Advancing his arguments in LPP case on behalf of petitioner HEL before a division bench, comprising Justice Mohammad Moosa K.Leghari and Justice Sajjad Ali Shah, Mr Pirzada conceded that privatisation or “un-bundling” of Wapda was approved by Council of Common Interests in 1992-93 for 124 other organisations.

The bench fixed the matter for February 1 with directives to Attorney-General of Pakistan to appear on the said date and assist the court on moot point regarding Privatisation Commission Ordinance 2000 after amendments were made in Wapda Act in 1994 by federal government. The court ordered that interim order passed earlier would continue.

Mr Pirzada said that without bringing Privatisation Commission (PC) into picture no government asset could be privatised. He said, PC was created after President promulgated PCO 2000 and rules were framed subsequently.

Discussing the background of LPP's proposed leasing or privatisation, he pleaded that after meeting of Sindh Cabinet Committee on Privatisation on LPP's privatisation, the Sindh Privatisation Commission referred it back to federal government on June 29,2006 for its privatisation through PC and provincial government demanded its share out of proceeds it held in Lakhra Coal Development Company (LCDC).

All of a sudden, he said, it was learnt that on December 12,2005 prime minister through federal secretary water and power issued directives to Wapda to complete rehabilitation and increase availability capacity of coal-fired LPP while through another letter, dated January 6,2006, written by chairman AG to respondent Chairman Wapda, referred to the draft of memorandum of understanding (MoU) as well as plant assessment report.

While Sindh government until June 2006 did not concede anything regarding privatisation, he said, prime minister issued directive for rehabilitation of LPP on December 12,2005. “It's a cruel joke”, he said while referring to correspondence between chairmen of AG and Wapda regarding signing of MoU on January 7,2006 but it was postponed.

He said that petitioner HEL participated in the competitive bidding process and was repeatedly asked to reduce its bid which it did thrice. He added that even Wapda admitted that HEL was the better bidder having an experience in the energy sector and running of a coal power plant. He said that when the bids were opened on July 21,2006 it was revealed that respondent AG had already been pre-qualified and was given contract surreptitiously on August 12,2006 and an assurance regarding first right of refusal was given to it in case some one else comes forward. “What sort of competitive bidding is this and how can respondent invest without approval of Wapda”, he said. He said that LPP was leased out on build, operate and transfer (BOT) basis for 20 years which was normal life of a plant. He said that the entire case revolves around points of transparency and by-passing of the Privatisation Commission.