FEBRUARY 20: The Power Minister P R Kumaramangalam has asked the Navratna PSU, National Thermal Power Corporation (NTPC), to negotiate with bidders for plant packages for its four power projects instead of going for rebidding to avert the cost escalation."We have advised for negotiation route as the rebidding could increase the costs of the projects even by Rs 800 crore as the market has become tight. However, NTPC is free to take its decision," Kumaramangalam told reporters here today.Admitting that power ministry had turned down the NTPC's request to reconsider its advise to enable them to initiate rebidding, he said "I was of the view to issue a presidential directive as I believe there would be an increase in price if they go for rebidding."However, on second thought, prudence prevailed in my mind and now I am of the view that NTPC being a Navratna PSU, it should take the decision," he said.NTPC board had decided to go for rebids for expansion of four gas-based projects at Anta, Auriya, Kawas and Gandhar, totalling about 2800 mw, but the Minister said the decision had not been `recorded'.While state-owned BHEL was sole bidder for the Anta and Auriya projects in partnerships with German multinational Siemens, it was competing with the only other bidder ABB-Alstom for the remaining two projects.Asked if negotiations with bidders would tantamount to violation of guidelines by Central Vigilance Commission that barred negotiations with anybody other than the lowest bidder, Kumaramangalam said "no, we have taken legal opinion."Kumaramangalam, however, did not comment on his response if the Navratna company decided to go for rebid against the ministerial advise saying "I do not want to intimidate the NTPC board," but added he was accountable to Parliament.Asked if NTPC had decided to give up the rebid route, he said "no decision has yet been communicated to me." Stating that BHEL had agreed to extend the validity for all the four projects after the initial two tenders resulted in non-responsive bids, ministry sources said that NTPC was advised to renegotiate with the bidders with a cap price to prevent cost escalation in third bid on watered down conditionality.Denying reports that there was clash of interest between the power ministry and NTPC, Kumaramangalam said "we had a situation wherein because of conditionalities not getting market response and the market having gone up in prices it was a difficult decision in the hands of NTPC and the Ministry."
