• Ministry claims it has secured sufficient stockpiles until Sept.

The Ministry of Energy has confirmed the rejection of the fifth emergency coal shipment from the Taranjot contract after it failed its load port evaluation.

Despite this setback, the ministry is confident that it has secured its minimum required coal stockpile to sustain national power generation through the current season, eliminating the need for any emergency power purchases before September.

Addressing the contractual complications surrounding the rejected emergency supply vessel, Ministry of Energy Secretary G.M.R.D. Aponsu stated: “The fifth emergency shipment from the Taranjot contract encountered an issue because its load port report was not successful, which represents the first such failure out of our total shipments. 

“According to the contract, we cannot permit the unloading of a vessel unless the load port evaluation is successful, as a successful report legally entitles the suppliers to receive an 80% advance payment of the cargo cost.”

Aponsu added: “The suppliers requested that we unload the cargo without immediate payment, but we refused because doing so would directly violate our active agreement and we maintained that we could not violate the terms of the contract. 

“While we discussed the possibility of creating a formal legal addendum to resolve the issue, such a process cannot be completed in just one or two days because it requires obtaining official approvals from the Attorney General, which left us in a prolonged discussion while the vessel remained outside the inner port.”

The Ministry Secretary said that during the discussions, Taranjot had been informed that the failed cargo could not be unloaded at the port and was therefore offered a window of time to provide an alternative vessel to fulfil its obligations. 

“The suppliers ultimately accepted this decision, agreeing to take the failed shipment back and replace it with another vessel that complied with our contract, although changing weather conditions means the sea will become rougher and the replacement vessel will likely arrive here during the first week of September.”

When asked about the coal supply situation, Aponsu stated that the total coal procurement initially planned was for 25 shipments, but when certain disruptions occurred with the Trident contract, it was decided to stop a few shipments and proceed with an emergency procurement of five additional shipments. 

“We subsequently calculated that the minimum requirement to maintain operations is 23 shipments, which means we definitely have to take 18 shipments from the first procurement alongside the five emergency shipments to create a secure operational balance,” he said.

Detailing the logistical distribution of the vessels, Aponsu noted: “With time, all the shipments experienced some delays, including the emergency ones, leaving no room to cancel or terminate the contracts through standard legal mechanisms because issuing a termination letter requires formal decisions and approvals. However, the initial suppliers continued loading on their own frequency, and by the time we reached this critical juncture, they had already loaded 20 shipments, bringing us to a more secure total situation of 25 shipments, even though they are currently scattered across different locations such as the loading port, out at sea, or awaiting offloading.”

When asked about the coal stock, Aponsu stated that 22 shipments had already been successfully processed and unloaded for this season, with the 23rd shipment – which successfully fulfils the minimum required baseline – scheduled to be unloaded either on the evening of 19 June or morning of 20 June.

“The 19th shipment from Trident is currently being cleared and we expect that this addition will ensure our power generation capabilities remain entirely secure until the next major procurement cycle begins during the second week of September.”

Outlining the progress of the upcoming long-term tender, Aponsu said that the procurement process for the next major supply cycle was moving forward within the established timeline, as the submission and technical evaluation phases had already been completed successfully. 

“We are currently conducting the price evaluations and we expect to issue the official order to open the competitive price bids in the coming week, ensuring the first shipment under this new tender remains perfectly on schedule to begin unloading by the middle of September.”

Following intense parliamentary and public scrutiny in relation to substandard coal supply over several months, the Government launched a committee to investigate the issue, with the Energy Minister and Secretary to the ministry at the time stepping down earlier this year in the face of strong opposition in relation to the procurement process and supply integrity.