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Print Print 2024-02-19

GTPS, SPS Faisalabad: NPGCL, Wapda at odds over ownership rights

  • CEO NPGCL conveys serious concern of the company’s Board on intrusion of Wapda’s security guards on the premises of properties of NPGCL in Faisalabad
Published February 19, 2024

ISLAMABAD: Northern Power Generation Company Limited (NPGCL) and Water and Power Development Authority (Wapda) are reportedly severely at odds on ownership rights of properties of Gas Thermal Power Station (GTPS) Faisalabad and Steam Power Station (SPS) Faisalabad, well informed sources told Business Recorder.

In a letter to Chairman Wapda, Chief Executive Officer (CEO) NPGCL Sabeeh Uz Zaman Faruqui conveyed serious concern of the company’s Board on intrusion of Wapda’s security guards on the premises of properties of NPGCL in Faisalabad.

According to CEO last year, certain actions were taken by the Principal, Wapda Engineering Academy (WEA) Faisalabad and his security personnel, supposedly without Chairman Wapda’s approval, which is in violation of NPGCL’s proprietary rights to GTPS Faisalabad and SPS Faisalabad.

NPGCL gets separate generation licence

CEO NPGCL, in his letter claimed that both GTPS Faisalabad and SPS Faisalabad were transferred by Wapda to NPGCL under the terms of the Business Transfer Agreement of March 1, 1999 (BTA) and the Supplementary Business Transfer Agreement (SBTA) of June 24, 2004 (effective from March 1, 1999). NPGCL has been operating these thermal power plants, and has been enjoying their use and possession of these plants and their sites since the unbundling of Wapda’s Power Wing in 1998.

On October 31, 2023, Principal WEA issued two notifications, whereby, he “directed” that in future, all allotments in residential colonies of GTPS Faisalabad and SPS Faisalabad would be done by him, and that all “unauthorised entry” into their premises would be restricted.

The Plant Manager GTPS Faisalabad wrote to the Principal WEA on November 2, 2023, asking him to withdraw the said notification, for being without any authority and in contravention of the BTA between NPGCL and Wapda. However, the Principal WEA wrote back on November 7, 2023 dismissing the contents of NPGCL’s letter outright, and stated that the notifications were issued with the approval of Chairman Wapda office.

“The tone and words used by the Principal WEA in the letter were certainly not of the level expected in such official communications,” said Sabeeh Faruqui.

On November 13, 2023, Deputy Director (Security) Wapda conducted an unauthorised visit of the GTPS Faisalabad with two Inspectors and 15 armed guards and went from shop-to-shop, demanding that future rentals be paid to the office of the Principal WEA.

“Although NPGCL’s armed guards were also present on the site, they were instructed to de-escalate the situation, to avoid any untoward incident,” claimed CEO NPGCL in his letter.

NPGCL argued that Wapda’s sudden interest in the land, colonies and shops of GTPS and SPS Faisalabad is surprising, given that the Wapda has had nothing to do with these assets for more than 20 years now.

CEO NPGCL also shared arrangements with Chairman Wapda, under which these properties were under its control.

NPGCL further stated that the provisions of the agreements between Wapda and NPGCL leave no doubt that Wapda had put NPGCL in possession and control of inter-alia, both GTPS Faisalabad and SPS Faisalabad from March 1, 1999 onwards, Wapda had no concern with these and NPGCL would be fully entitled to take all risk and rewards of these assets. At the same time, NPGCL assumed all risk and liabilities with respect to these assets and Wapda removed these from its book of assets.

“Our stance is further bolstered by the fact that in 2019, when the Pakistan Energy Sukuks were to be issued by the GoP against the assets of the GENCOs (including GTPS Faisalabad and SPS Faisalabad), NPGCL signed the agreements as the “title agent” of these assets, and since the title of these assets was still in Wapda’s name, the Power Division wrote to Wapda to seek its NOC in the matter,” he said adding that Wapda duly gave its NOC to the proposed transaction.

CEO NPGCL urged Chairman Wapda to direct his officers to act in accordance with the provisions of the BTA and the SBTA and to refrain from any encroachment on NPGCL’s assets, adding that if Wapda has any issues, or feels that there is a dispute over the BTA and SBTA, he is willing to meet and resolve it.

According to CEO NPGCL, the company had made this offer in the past to Wapda officials, who have refused to meet on this matter, despite committing a time and place for a meeting.

Alternatively, Cabinet Division’s U.O of April 13, 2017 requires that any dispute between government entities should, in the first place, be resolved through the Secretaries Committee.

NPGCL has suggested that both government entities, i.e., NPGCL and Wapda should try to resolve any dispute over the title and control of these assets through the offices of the Secretary, Power Division, and the Secretary, Water Resources Division.

CEO NPGCL has also requested Chairman Wapda to restrain his officials from taking any unilateral action, harassing NPGCL’s staff and tenants and entering into premises of GTPS and SPS Faisalabad.

Copyright Business Recorder, 2024

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