Fuel insurance tender: Angels of brokerage and suspension are present

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Fuel insurance tender: Brokerage angels and disruption present. Today, Friday January 15, 2021 02:17 AM

A remarkable calmness marked the relationship between the Ministry of Energy and the Tender Administration in the last meeting between the two parties, which was devoted to discussing the appropriate book of conditions for conducting a tender for the import of fuel for the benefit of the Electricity of Lebanon Corporation, succeeding the Algerian company Sonatrach, whose contract with Lebanon ended at the end of 2020.

However, calm is still cautious, as it is governed by the Ministry of Energy’s desire to follow clear legal frameworks, a commitment to developing a transparent book of conditions and a reliable fuel supplier, as well as monitoring the purchase process and making sure of the fuel quality .. all of which are steps that were not taken into consideration with Sonatrach.

Positive initiative
In contrast to the successive energy ministers, the current Minister, Raymond Ghajar, has shown openness towards managing tenders, expressing his desire to conduct the next bid through the Tender Department. The meeting on Wednesday, January 13th, was an entry point to strengthen the relationship between the two parties, and a means to ensure a transparent and legal tender par excellence. The meeting concluded an agreement on the book of conditions, so that the Ministry of Energy has yet to arrange some administrative procedures, before returning to the Tender Department to arrange the tender. Sources in the Ministry of Energy indicated, during an interview with Al-Modon, that “what happened in the case of adulterated fuel was a motivation to modify the course of conducting tenders. Also, the ministry has no desire to antagonize the tendering administration or marginalize its role. What was happening in the past between the administration and the ministry. It does not deviate from the framework of the divergence of opinion and viewpoints regarding contracts and tenders, but the final goal of the ministry is to conduct tenders that guarantee the public interest.

In parallel, the Tender Department believes that “the commitment of all parties to the legal obligations that were set during the meeting is sufficient for a transparent bidding process, and evidence of positivity.”

Oversight and controls
The fuel supply mechanism, which the Electricity Corporation has been accustomed to using for years, led to the adulterated fuel scandal. Apart from the political reasons for bringing it out into the open and not correcting the defect in earlier times, the Ministry of Energy is apparently keen not to fall into the same problem. However, this concern is only translated into a new contract form that defines the control mechanisms, whether on fuel shipments or on the supplier, and this requires deciding on the identity of the supplying party, is it an exclusively global company, or a coalition that brings together a global party with a Lebanese party?

Also, the process of determining the names of the shareholders in the supplying company and obtaining a certificate from the Chamber of Commerce and Industry in the home country, and data from the commercial register, play an important role in ensuring the whiteness of the company’s page, and in raising the level of reassurance about it. Not to mention the importance of preventing the supply of fuel from other sources different from the company that will be contracted with, under any excuse, especially the excuse of necessity and gaining time.

Evasion attempts
It has not yet been decided whether the supplier will be an exclusively foreign company or whether there will be a Lebanese partner. Indecisiveness is the key to eluding those close to a former energy minister. This endeavor aroused the anger of the current minister, who seeks to cool the atmosphere within the ministry and come up with a new contract and mechanism to obtain the fuel, while the former minister and his “angels” are present to perpetuate the quota system, by leaving loopholes in the contract and conditions that need to be dismantled, similar to the contract with Sonatrach.

Accordingly, a team within the ministry is seeking to contract with a foreign company that has no arm in Lebanon. So she comes to Lebanon and “sets her head” and searches for herself to find a railroad to supply fuel, and here comes the role of influential people in the ministry to woo the foreign supplier and push it towards specific local companies that are well-oriented and benefit. Since the terms of the contract in this case do not specify the role of the Lebanese partner, the wheel will be managed according to the winds of the beneficiaries in the local companies and the Ministry of Energy. The owners of this opinion excuse to cut off the road to brokerage attempts by local bodies, because importing by direct line with the foreign supplier is safer.
This excuse is returned to its owners, because any foreign supplier must find a local partner to help him. Hence, it is necessary to watch the local partner and his role in the contract, which ensures that the partner’s work is controlled and monitored, so that all parties to the process become within the rules of the game, and no one is an exception.
However, adhering to the foreign identity of the supplier exclusively, hides questions about the possibility of hiding a foreign company behind the scenes, waiting for the appropriate circumstance to take it out and sewing an employment contract according to its size, similar to the contract with the Turkish company Karadeniz in the file of energy ships. Such a scenario is left to the last moments under the pretext of time and securing the public interest, which is an excuse that the parties of the ruling system master.
Another possibility is the bet on the time to renew the contract with Sonatrach, after agreeing with it on some amendments, in exchange for turning the page on the dispute over the adulterated fuel and removing all legal obstacles. It is the closest approach towards which the angels of the former minister tend, especially since the local companies that benefit from the loopholes of the contract with Sonatrach have a close relationship with the former minister, and it is natural that he seeks to preserve his interests and those of friendly companies. As opposed to what a new contract sponsored by a proven efficient bidding management could create.

Other obstacles
Unfortunately, the new tender may not go on the right track, because the monetary and financial reality of the Lebanese state does not attract international companies, which do not hide their concern about Lebanon’s ability to pay the fuel price in dollars. Even Sonatrach may not be interested in renewing the contract with Lebanon for financial reasons. And the Banque du Liban, which insures the funds with which the Electricity Corporation buys the fuel, is unable to guarantee the dollars required for the import.

On another line, some hope that negotiations with Iraq will provide the possibility of securing the fuel, but the agreement on the mechanisms of supply and payment will not be within reach by next February, which means that Lebanon is in a race against time that cannot be resolved unilaterally, because Iraq is not It is forced to burn stages and implement a speedy agreement with Lebanon. Note that the agreement with Iraq will not be free from the interference of brokers, commission seekers, and influential people in the Ministry of Energy and outside it. The politically supported fuel mafias do not see the path of contracts with tied hands, but rather move their arms to find a place for themselves in any new contractual formula.







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