Picture taken from Zawya.com
I’ve heard news of a lawsuit being prepared against the Energy Ministry and Lebanese government before but I wasn’t sure about it up until now. Here’s a small brief on what happened:
A tender to build a new power production unit at the Deir Amar facility was initially won by Abener-Butec, a Spanish-Lebanese consortium few months back. The contract was estimated at $662 million dollars, which according to Energy Minister Gebran Bassil, exceeded the $502 million allocated to fund Deir Ammar’s reconstruction. What happened next is that the first tender got cancelled and a second one is set to be open for interested companies.
Under the terms of the tender, Energy Minister is allowed to seek a 10% reduction from the winning company, and Abener-Butec agreed to these terms by downsizing the capacity of the new plant from 535 megawatts to 430 megawatts, but refused to cut down the contract by $160 million, which kind of makes sense. [DailyStar]
“You cannot ask us to deduct more than 10 percent of the total costs of the project, because if we were able to reduce costs more than that then how much profit would we be making? We’d be stealing from the government,” Zakharia said (Myrna Zakharia, Butec’s PR and communications adviser).
I don’t quite understand why did the government chose Abener-Butec’s offer in the first place if they knew they were above the amount allocated to fund Deir Ammar’s reconstruction. We are talking about international companies here with a reputation to keep, not some local bid over few thousand dollars.
Added to that, it seems the Spanish Company’s offer was apparently an excellent one:
“The offer Abener-Butec had made gave a really good price, even lower than what the ministry had expected,” said Younes. The consortium’s offer set the cost of producing one Kilowatt at $1,262 when using heavy fuel and $1,170 when using gas. Younes said the consortium’s offer also maintained high-quality implementation: “Our competitors were Indian, Turkish, and Chinese companies, our offer was the best, in terms of value and quality.”
I am not sure how solid is Abener-Butec’s case legally speaking, since no contract was signed yet, but we might end up getting unofficially blacklisted by international companies because of that.
Butec have the best bid in place. In addition, most of their employees are Lebanese and are locally based (many also coming from the North).
That it has now reached this point of lawsuits is all a result of Bassil’s sheer incompetence and greed.
And you are correct, if international companies see Lebanon treating bids and tenders like this, then they will boycott future tenders entirely.
Wasn’t Nizar Younes the ally of Bassil in the elections? Or maybe his brother, I can’t remember. They seem to be not at good terms now.
What I do know, is that this company Butec is a Lebanese company owned by Nizar Younes, not an international company, but it’s only allied with another spanish company, so being “blacklisted” internationally is absurd.
Secondly, their only defense to win the lawsuit is a “moral loss”, i.e. they suffered no actual material and financial losses, so it wasn’t a very good case. But they do have right on their side, since they won the tender with the price they had placed, and the government had absolutely no lawful right to make them lower the price after it had already been agreed upon when they won the contract.
Third, and most importantly, your info is not up to date, the lawsuit has already ended, Butec lost and government won.
Goebbels,
I think Nizar’s brother ran with Bassil.
Concerning the lawsuit, this article is 2 days old. Are you sure about that? Maybe u r talking about some local lawsuit but international mediation is different.
It saw it announced on a News Channel. I’m 100% sure it was the Butec case.
7ejeh tfelsof chabeb. The issue is clear: Bassil rejected it because another company offered to pay HIM more!
http://www.dailystar.com.lb/Business/Lebanon/2013/Mar-12/209710-consortium-denies-lawsuit-over-power-plant-deal.ashx#axzz2NcLHsguf
I would like to clarify few points here. Nizar Younes was Bassil ally in previous elections. The tender was rejected because the 502 M$ allocated amount was exceeded by Butec by 160 M$. They reduced their price by 96M$ but it wasn’t enough. Hence the gov had to re-tender.
The company filed a lawsuit at Majels Shoura al dawla asking to stop the re-tendering process and it was rejected. Which means Butec lost.
The terms and conditions when tendering with the gov are clear. The gov has no obligation to award you the project if you win and you are considered a temporary winner since there is no contract btw the 2 parties.
The gov can re-tender without even providing a reason and this happens a lot. In the case of Deir Amar there was a valid reason. The money wasn’t enough.
Abener-Butec has the right to go to international courts but they already signed the terms and conditions before tendering and that would be a useless move.
What has been said about unofficially blacklisting Lebanon by international companies is wrong because in the 2nd tender many europeans companies applied and the winner was a greek/US consortium J&P Avax and GE for the amount of 360M euros.
Maybe you haven’t noticed but last week US officials ,a senior State Department delegation comprising Deputy Assistant Secretary of State for Energy Diplomacy Amos Hochstein and Acting Deputy Assistant Secretary of State for Near Eastern Affairs Lawrence Silverman praised Bassil for his efforts and hailed his ministry’s levels of “transparency and professionalism in meeting the highest international standards.”
http://bit.ly/YxPtYE
William Hague UK foreign sec visited the ministry 2 weeks ago and said similar things.
You can also take a look at the huge numbers of int companies bidding in the oil and gas tender. So far 30 companies bought the seismic data and 120 companies are applying.
joseph you are talking about Bassil’s sheer incompetence and greed.
I would like to know your opinion if Bassil awarded Butec the project in the first place. You will probably say that he gave it to his ally and that there is a 160 M$ commission in the deal. The guy did the opposite and managed to save the gov a lot of M$ adding to that an extra 20MW on the grid and he lost a strong ally in Batroun.
Rick Assuming he is getting a commission don’t you think it was better for him to award it to Butec since 662M$ is much larger than 470 M$
What is sad is that many lebanese are eager to see an international lawsuit filed against the lebanese gov and they will probably take Abener’s side just to screw Bassil. Which reminds me of the famous lebanese quote :
“Byo2toch Ay** laytmanyak 3a marto “
The United States also praised Bandar Bin Sultan and Mohammad Morsi for their efforts and hailed their levels of “transparency and professionalism in meeting the highest international standards.”
United States mish marja3.
If Bassil really is as uncorrupt and principled as you say, he’d be terrorist #1 in the United States.
Red – you are wrong. The US did not say this – “transparency and professionalism in meeting the highest international standards” – about Bassil.
Bassil said that about himself.
Fact is, Bassil is greedy and incompetent. He wanted money (a bribe if you like) from BUTEC and they wouldn’t budge.
Tell me Red, how does someone like Bassil manage to, among other things, buy land, build and then rebuild one of the biggest villas in the Laqlouq?
US mch marja3 but I only mentioned the US officials and Hague in reply to
“but we might end up getting unofficially blacklisted by international companies because of that.”
I forgot to mention that right after the Butec lawsuit a Danish/German consortium signed a contract to rehabilitate Zouk power plant.
So my point is ur not getting blacklisted by anyone, They have their eyes on our Oil and Gas and you will probably be seeing a lot of US,UK,French, Japanese, Korean, Russian ,,, companies in Leb
Joseph, Bassil said it because the US officials were supposed to speak after the meeting but due to the lack of time they couldn’t so he briefed the reporters about the discussions. You think he made it up , if thats true y didn’t they deny it. so please we are not kids here.
” He wanted money (a bribe if you like) from BUTEC and they wouldn’t budge”
I don’t know where u get ur info from but don’t u think if he asked for a bribe Butec would have made it public by now or at least mentioned it in the lawsuit. I understand u hate bassil but at least use ur common sense when ur analyzing a situation. it was for his best interest to give it to Butec.
You can check Nizar Younes, Butec owner press releases and interview.
As for his villas in Laqlouq I guess it falls in the same category of his invisible private jet which we never saw and his 1B$. You watch a lot of Future TV.
Maybe you can provide us with some pics of his jet and his villas and a proof of the Billion $ so people will believe such rumors.
Maybe you can check Mo3rab palace and ask the so called Dr where he got the money from. Last time I checked he was in jail for 11 years.
Or u can ask Hind Hariri y she moved with 2B$ from our own money to the states with her driver, Or maybe ask her dad where he got his 24B$.
wanna talk abt Laqlouq check Hariri’s palace there. I m sure u won’t miss it.
The list goes on from Elyas Murr mention in Rabiyeh to Berri and the rest.
General Aoun’s villa in Rabiyeh is a rental and Bassil owns an apartment in a building not villas.
Red – you are nothing but a propagandist and apologist for an incompetent and greedy minister.
I spoke about the incompetence and greed of Bassil and you retort with Hind Hariri, Berri, Geagea and Murr?
Khalas, go on living through your orange-tinted glasses.
Ohhhh resorting to personal insults when you have nothing to say? Looks that you are the one who is wearing the ‘pick a color’-tinted glasses over here.
Hahaha Joseph – When you resort to this level of argument, it is useless to waste my time on sm1 as close minded as you.