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Government denies second agreement with New Fortress Energy

12 Oct 2021

  • CEB TU Alliance alleges inking of deal sans Cabinet knowledge this week 
By Pamodi Waravita  Power Minister Gamini Lokuge yesterday (12) denied claims made by the Ceylon Electricity Board (CEB) Trade Union (TU) Alliance Convenor Ranjan Jayalal that a second agreement will be signed between the Government of Sri Lanka (GoSL) and the US-based energy Company, New Fortress Energy. “There is no such agreement that is coming up,” Lokuge told The Morning yesterday (12). However, Jayalal, speaking to The Morning, claimed that as per their knowledge, another agreement between New Fortress Energy and the GoSL will be signed this week, without the knowledge of the Cabinet of Ministers. On 13 July, New Fortress Energy announced that it had signed a Memorandum of Understanding (MOU) with Lakdhanavi Ltd. to jointly develop a 350-megawatt (MW) gas fired power plant in the Kerawalapitiya Power complex located in Colombo. At the time, its Chief Executive Officer and Chairman Wes Edens said that the partnership is part of their efforts to accelerate Sri Lanka’s transition to cleaner and cheaper energy. Prior to this statement, New Fortress Energy said that it had signed a Framework Agreement with the GoSL to construct a new offshore liquefied natural gas (LNG) receiving, storage and re-gasification terminal to supply gas to Sri Lanka’s power plants, primarily located in the Kerawalapitiya Power complex. Thus, New Fortress Energy added that it has agreed to supply natural gas to the existing 300 MW Yugadanavi Power Plant and that it is negotiating the purchase of the Government’s 40% stake in the Yugadanavi Power Plant. Janatha Vimukthi Peramuna (JVP)-led National People’s Power (NPP) Leader and Parliamentarian Anura Kumara Dissanayake has demanded that the Government explain as to why New Fortress Energy was given the Treasury’s 40% stake in the Yugadanavi Power Station in Kerawalapitiya outside of the open tender process that was called by the Government in February of this year. He has also claimed that the agreement with New Fortress Energy was signed past midnight, during the early hours of 17 September. The Sunday Morning reported that objections to the deal were raised by three Cabinet Ministers who had stated that the deal would monopolise the LNG supply. The Sunday Morning further reported that the Treasury Department is due to earn approximately $ 300 million as a result of this transaction. However, allegations levelled against the deal claim that the long term loss to Sri Lanka through the deal is around $ 6 billion, and that it threatens the country’s energy security.  


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