Govt’s Second Thought On Tarbela-4 Project Incurs Rs. 100 bn Loss

The government appears to have developed second thoughts about taking action against those senior Wapda officials who, as per the inquiry, ordered by Prime Minister Imran Khan, were responsible for around Rs100 billion loss during the execution of Tunnel-4 Tarbela project.

The inquiry report was presented to the prime minister in Feb 2019 seeking performance audit of the project and the subsequent criminal inquiry into the matter by NAB or FIA but now sources claim that the report has been shelved after the intervention of Minister for Water Resources Faisal Vawda.

Faisal Vawda, when contacted, said that the inquiry ordered by Prime Minister Imran Khan was initiated before his induction in the cabinet. Vawda said that he does not know what the fate of the inquiry’s recommendation is but disclosed that he did forward to the prime minister an objection against the inquiry.

The minister said that he was approached by one of the technical members of the Investigation Committee, which conducted the inquiry, claiming that the inquiry report was submitted without his input. Later, the minister said, he referred the matter for review to officials concerned of his ministry who submitted their report. Vawda said that he sent the report regarding the inquiry to Prime Minister Imran Khan.

Last year, Prime Minister Imran Khan had ordered the inquiry while taking notice of The News report about loss of billions of rupees incurred because of pre-mature inauguration of Tunnel-4 of Tarbela Dam.

The Investigation Report determined from the statements of M(P), Adviser Projects Wapda, CE (O&M) and the PD T4HPP that the date of inauguration was made without their consultation and also not at the authority level of Wapda, rather, it was done at the level of Wapda chairman.

The report calculated a total loss of $753 million (over Rs100 billion) during the execution of the Tunnel-4 Tarbela project and it included that the losses incurred because of serious faults occurred owing to the premature inauguration of the project in March 2018.

The Wapda chairman was of the view that the investigation report was not based on facts. He had told The News a few months back that the inauguration decision was taken strictly in accordance with “commercial coordinated schedule” in June 2017 as was agreed between three stakeholders- employer, consultants and the contractor.

The investigation report, however said, “The statements of Wapda chairman and Adviser Projects provide that the project completion dates were fixed to save the project from the conditions of time at large and these dates were fixed in July 2017 stating inter alia the completion of Unit 17 on 25-02-2018. With this in view, the date of operation of Unit 17 stands established to be fixed through a consultative process of the parties to the contract vis — the employer (Wapda), the consultants (T4CJV) and the contractors (Civil and EM contractors). The unit 17 was subsequently inaugurated on 10-03-2018. Notwithstanding above, it is also determined from the statements of M(P), Wapda adviser projects, CE(O&M) and the PD T4HPP that the date of inauguration was made without their consultation and also not at the authority level of Wapda, rather, it was done at the level of Wapda chairman.”

The report did not say that the premature inauguration was done following the pressure from the then PML-N government or the prime minister. Instead, it said that on the eve of inauguration, Wapda submitted the following talking points for the then prime minister, Shahid Khaqan Abbasi: “Commissioning of Tarbela 4th Extension Hydropower Project is yet another historic milestone achieved by the government to add to 1410MW in the national grid.”

“Completion of this great project within time and cost always held top priority of the government. While congratulating the whole nation on this remarkable achievement, I would especially appreciate the untiring efforts of the project team comprising Wapda staff, project consultants, all the contractors and other stakeholders whose selfless devotion enabled to timely complete the project.” The Investigation Committee (IC), constituted by the prime minister into losses incurred because of pre-mature operation of Tunnel-4 of Tarbela Dam, unanimously determined that the total loss occurred during the execution of the project comes to $753.7 million.

According to the report, this loss includes, “$350 million estimated and projected by Wapda for the years 2017 & 2018, $48 million paid to the civil contractor on account of acceleration under the VO-02 R2 and $5.7 million under CO-10”. Besides, the report added, another loss of Rs70 million incurred by Wapda to lift the gates of draft tubes stuck in the mud after the refusal of the civil contractor.”

With regard to the loss to the national exchequer due to inauguration of the project before time, the report said, “It is important to mention that there is a further matter which needs probe relating to signing of variation order in March 2015 for making payment to the contractor equivalent to $51 million in order to accelerate the project completion from March 2018 to June 2017.”

The report added, “It has also been brought before the IC that despite making substantial payments of the order of $48 million on account of VO-02 R2, not a single unit could be made ready for generation up to the end of the high flow season of 2018 let alone 2017.

“The annual energy generation from T4 HPP as estimated at the design stage was 3,840 million units. Because of having no energy in the high flow season of 2017 the associated revenue loss becomes Rs30 billion at the rate of generating cost of Rs7.814 per unit of electricity, despite spending $48 million extra to the revenue equivalent to Rs30 billion,” the report added.

While discussing the premature inauguration of the project, the report lamented that the most worrisome aspect of the alarming state of affairs in Wapda is that the saner voice and expert advice of Independent International Panel of Experts (IPOE), especially engaged on hefty payments from the national exchequer with acclaimed global contemporary technical knowledge and insight as well as of-reputed series of explicit and unequivocal warnings by the World Bank, not only disregard and project timelines were not rescheduled to the flood season of 2018 i.e. June/July 2018 in order to doubly reassure smooth and hazard-free operations.

(Published in Monthly Tribute International on 01-07-2019)