15 October, 2008
Income Electrix – Sierra Leone
Income Electrix
Limited writes to Anti-Corruption Commission
Income Electrix Limited writes in response to the Anti-Corruption Commission Report
on the contract signed between them and the government of Sierra Leone for the supply of electricity to the capital of Freeetown.
Income Electrix submitted their response and accompanying appendix to Sierra Express for publication – see below.
Hon. Abdul Tejan-Cole Esq.
Commissioner,
Anti-Corruption Commission (ACC)
Republic of Sierra Leone.
Wednesday October 15th 2008
Honourable Sir,
RE: FAULTY LINES IN A FLAWED & COSTLY CONTRACT
Our attention has been drawn to the above titled report credited to your Commission
and we would like to state as follows:
1.
Income Electrix Limited (IEL) is a reputable Nigerian
firm with enviable credentials in the field of electrical power engineering. As a good corporate citizen, IEL respects the
laws of Sierra Leone and fully respects and supports the valuable work you are doing at the Anti Corruption Commission of
Sierra Leone. We realize that you have the legal mandate to protect the people of this beautiful country, Sierra Leone from
the corrupt practices that have resulted in the country suffering from mismanagement of its resources over the years. Sir,
we fully respect the ACC but after reading the recently issued ACC Report entitled “Faulty Lines in a Flawed and Costly
Contract”, we strongly believe that we have been unfairly treated and we request for the ACC to review its Report after
giving us a chance to be heard.
2. Sir, on Page 2 of your report, you state inter alia,
“In order to procure the
additional emergency thermal power and as a fall back arrangement in the event the World Bank support delayed...”
Sir, we are not aware that the emergency power sought from us was a fall back arrangement in case the World Bank
support delayed. Our proposal and negotiations commenced well before the World Bank’s Request for Proposal and we were
made to understand that the 15MW backed by the World Bank will not be sufficient to actualize all the electricity needs of
the capital city.
3.
On Page 3, you state inter alia,
“The contract for the supply
of the 25MW was awarded to Income Electrix Limited on the 23rd November 2007 amidst alleged controversies as was evident in
Messrs Tani Pratt and Professor Jonas A.S. Redwood-Sawyerr’s letter…”
Sir, we were not aware of such controversy;
we were only told that our initial 3 months moratorium was not accepted by the Working Group who instead requested 6 months.
After consultations with our Financiers, we were able to increase the moratorium from 3 months to 5 months in favour of Sierra
Leone.
4. On Page 4 of your report under Chronology Of Events, the
inclusion of phrases like “participated and failed” and “after they lost their first bid” seems to
suggest “fail” and “lost” are crimes. In a competitive bid, only one bidder wins. All the others fail.
Based on our responsiveness, the World Bank commenced negotiations with us but later decided to settle for GTG whose bid they
must have preferred. Out of over 13 companies who participated, we emerged as the runners-up to GTG so we must have submitted
a reasonable bid.
5. On Page 5 of your report under The Procurement Process And Sole Sourcing
Procedure, you assert:
“the Working Group#1’s Final Report considered Income Electrix’s “conditions
as being very unfavourable to GoSL/NPA”.
However, the only unfavourable condition communicated to us was the aforementioned issue of our proposed
3 months moratorium which after discussions, we moved to 5months which latter was accepted.
6.
On Pages 8 and 9 under “Procurement or
Investment?”, there seems to be a misunderstanding of the meaning of Independent Power Provider (IPP). IPP
means an independent power producer or generator of electricity. It does not mean a utility or power retail company. An IPP
produces power and sells it to a utility such as NPA which retails the electricity to the end-user. At no time did we propose
to sell power directly to consumers as the existing laws of Sierra Leone could not even have permitted it. It is also highly
misleading to compare GSM Telecommunications Companies to IPPs. Electricity distribution is a natural monopoly and no two
electricity distribution companies can operate in the same geographical area without delineation. So, comparing it to GSM
telecommunications companies is very misleading. GSM telecommunication signals are not carried by physical wires but through
space. Several GSM companies can operate in the same area. Once they set up their equipment, they can all reach any of their
customers in the same geographical domain. It is not the same for electricity. The comparison is non-existent.
7.
On Page 9 of your Report under “Manipulation
of the Procurement Process”, it is news to us that IEL was not recommended by the Working Group. However, the
company called Emieola Group which was supposed to have proposed superior technical and financing capacity to have satisfied
the requirements of the Government of Sierra Leone, was also awarded a 20MW Contract alongside IEL’s 25MW Contract.
Until date, Emieola Group has been unable to perform despite their “superior” presentation. We believe IEL should
be commended for performing and all those who had the foresight that IEL would likely outperform the others, should also get
commendation. Those who made misjudgments about IEL should now be courageous enough to concede that their judgment was not
correct.
8.
In reaction to “The Commission’s
Findings”, which start on Page 10 of your report, we first of all reiterate that the members
of the technical committee who opted for IEL should be commended for their good judgment in being able to identify
who can perform as against those that were possibly being recommended for other reasons but couched under technical advise.
9.
With respect to Paragraph 5 of your
Findings, we believe what was presented to the NPPA was that the project will be pre-financed and not that it will not have
financial obligations on NPA and the Government. The NPA is the sole off-taker of the power generated by IEL. Sir, was NPA
expected to be taking the power for free?
10. With respect to Paragraph 9 of your Findings, at no time did
the IEL proposal or contract not have financial obligations. It had a clearly stated contract sum. Sir, what should that sum
be termed as? Additionally, our international bankers providing us the loan to start the project, had concerns as to whether
NPA alone could afford the operational cost of the project. When these concerns from our financiers were brought to the attention
of the Government, the Government of Sierra Leone issued the 6th November 2007 Letter of Commitment to IEL that bore the signature
of no less a person than Sierra Leone’s Finance Minister David Carew who was in an adequate position to know what the
Government could or could not financially commit itself to.
11.
With respect to Paragraph 10, we do
not understand how a power contract whose maximum sum (at 100% operating capacity) is $65.5million, could somehow be interpreted
to have a real cost that could reach $100million. We would like to know how that figure was reached. It should here be noted
that despite IEL establishing a presence on the ground since 23rd November 2007 (when the contract was signed and civil works
were started), and providing power from Blackhall Road since 12th February, 2008 when no less a person than the President
of the Republic of Sierra Leone, Dr. Ernest Bai Koroma commissioned the Plant, IEL has not received any money under the contract
from NPA or the Government of Sierra Leone. The IEL contract had a provision for a generous five month moratorium specifically
inserted; in order to give NPA and Government of Sierra Leone time to generate power, accrue income and service the IEL contract
with the generated revenue.
12. With respect to Paragraph 12 on the issue of providing 2 to 3
MW instead of the 10MW currently commissioned, we do not know where the ACC conducted its investigations but it is a fact
that the ACC never visited the site of the execution of the contract. IEL commissioned Blackhall Road Power Station in February
2008. IEL’s Contract indicated that IEL should procure diesel, but for reasons best known to the Government, they did
not adhere to the terms of the contract that should have facilitated such purchase (i.e.: issue a Letter of Credit). Instead,
NPA decided to be the one providing us with diesel to run the machines that supply electricity power to Eastern Freetown.
Therefore, IEL can only run the number of machines for which fuel is provided for. Sir, we want to make it very clear that
we have the capacity to keep all the 10MW machines on at full steam but the available fuel supplied to us on a weekly basis
would only run all the 10MW units for a limited time following which the supplied fuel would be consumed. Our ability to supply
the full 10MW at any given point in time is directly linked to NPA’s financial ability to supply the required fuel since
the Government did not issue the contractual Letters of Credit. Now, since virtually the entire East of Freetown from Kissy
Road to the far Waterloo environs are supplied by power generated by Income Electrix and since this is the most densely populated
part of Sierra Leone, should Income Electrix decide to shut down our machines, a huge swathe of Freetown would be pitched
into bitter darkness. This is why we spread out the use of the diesel supplied to us weekly in such a manner as to supply
electricity to rotational segments of the East for a whole week. With this constraint, we can only power on as much machines
as we can fuel. If we are given enough fuel, we will power on all the machines throughout the week. It should also be noted
that IEL commissioned 10MW in February, provided over 6MW in March and April, almost 5MW in June, over 3MW in July and August
and again almost 5MW in September. Your investigators never visited the site of execution of the contract being investigated.
Otherwise, they would have confirmed these figures from the Meter Log Books.
13.
With reference to Page 13 of your Report under the
heading of “Onerous Terms of the Contract”, we are at a complete loss as to why this portion
was included as part of your report. You may not be aware that after the National Commission on Privatisation (NCP) through
Bruce Carrie’s advice raised the issues regarding the terms of contract, the Government set up a Presidential Re-Negotiation
Committee to address the issues raised. This Presidential Committee which included the NCP’s Bruce Carrie himself, was
chaired by the Secretary to the President and included the Finance Minister, the Governor of the Central Bank, the Financial
Secretary, the Attorney General and the Minister of Energy & Power. This Committee exhaustively thrashed out the issues
raised by Bruce Carrie with Income Electrix. The Outcome was a Supplemental Agreement which I attach here for your reference.
This Agreement that came out of the renegotiations was as a result of acceptable explanations for the supposed onerous clauses
that hitherto were not properly understood by the NCP.
14. Still under Onerous Terms of the Contract, genuine attempts to
compare the Global Trading Group’s Contract with the IEL Contract will show that IEL Contract Clauses are clear, simple
and understandable. During the renegotiations held at State House with the Presidential Committee, IEL requested the Government
of Sierra Leone to use the same conditions (Capacity and Energy charges, fuel consumption rate, minimum take off, etc) contained
in the World Bank’s GTG contract as a basis for the renegotiations. In response, no less a person than the NCP’s
Bruce Carrie, for the first time revealed at State House in no uncertain terms that the World Bank GTG contract is “not
a good contract”. So the question now is: Where do we go from here? GTG Contract is not good and IEL Contract is not
good. So, what is good for Sierra Leone to be able to boast of regular electricity supply? What is good that will ensure Sierra
Leone’s capital city does not revert back to being called the darkest city in the world? For your information sir,
power purchase agreements (PPAs|) of this nature are much the same and are standard templates,
15.
Sir, please find below a Price Comparison
between IEL and GTG
·
Fuel cost is 80% of power production cost. IEL imported
in brand new highly efficient machines which are 10% more fuel efficient than Global Trading Group’s own used machines.
Thus, if our figures are used for GTG’s operations at Kingtom, Sierra Leone would save over $150,000 every month.
·
Also the capacity charge (cost of hiring the machines)
and the energy charge (cost of operation and maintenance) of IEL is about 5% cheaper than that of GTG, which means we would
have saved Sierra Leone another USD45,000 monthly.
·
Again, GTG places 93% of her cost on capacity charge
(amount payable whether light is provided or not) while that of IEL is only 69%. So whether GTG generates power or not they
will still be paid very much close to their total cost. In fact it is to their advantage that they do not generate power at
all.
·
ACC overlooked the above cost-saving advantage IEL
has over GTG but decided to overly stress on the mobilization, civil and insurance costs that constitute less than
3% of the total project cost. Why?
·
On mobilization cost, IEL air freighted in a brand
new 10MW plant to Freetown (because of the political exigencies of keeping to H.E. the President’s pronounced December
2007 date) while the balance 15MW came in by sea. On the other hand, GTG brought in their used containerized generators by
sea from a much nearer location. Hence, the mobilization simply could not have been the same.
·
On civil cost, IEL brought in brand new plants to meet
the immediate emergency and the medium term power needs of Sierra Leone which require civil-works concrete foundations, while
GTG has old containerized generators that can be redeployed at any time and do not require civil foundations. IEL also had
to carry out extra civil works in the form of huge repairs on the premises and construction of a chain link fence and gate
around the facility. This was not the same for GTG.
Sir,
during your investigations into the IEL Contract, the ACC seems to have been given only a list of Bruce Carrie’s concerns
from the NCP whilst our own adequate responses to those concerns were not shown to you. We are therefore reproducing our responses
to the NCP’s Clauses of Concern as an appendix to this letter. The NCP’s Concerns are in Blue whilst our Comments are in Red.
IN
CONCLUSION:
Honourable Sir, the
pronouncement of the President of Sierra Leone in October 2007 was focused on providing reliable electricity to Freetown.
The fact that the World Bank’s GTG contract provided 15MW of electricity to the Western area of Freetown did not mean
the perennial electricity shortage issue was solved. The entire Eastern area of Freetown where arguably the bulk of the population
resides and where virtually all the industries and factories are located still needed electricity, thus the IEL contract at
Blackhall road.
When IEL came in, we found an archaic system of power generation and a primitive Transmission, Distribution
and Safety Device systems in place. A significant percentage of these systems have not been upgraded to modern standards from
the time Sierra Leone was under British Rule. Although we had no such contractual obligations, IEL did a survey (free of charge)
of NPA’s Transmission & Distribution (T & D) Network in Freetown and subsequently provided highly technical
advice (free of charge) to NPA. We even imported in modern cables and jointing kits which we supplied to NPA to improve her
ability to transport the power from both Kingtom and Blackhall road to the consumers.
IEL’s top-notch
Power Engineers from India and Nigeria, working in consonance with NPA Engineers have ensured that despite these archaic hurdles,
the vision of H.E. Dr. Ernest Bai Koroma for a brightly lit Freetown has been attained. President Koroma’s promise to
his people has been kept. It has been a tough task that saw us shedding sweat and blood. What Income Electrix has undertaken
in Sierra Leone is indisputably a noble effort in chivalry; the likes of which are hardly seen in today’s corporate
corridors. I challenge that no other corporate entity will be able to exceed what we have undertaken.
Sir,
we have taken the opportunity of copying this letter to the Office of the President, the Speaker of the House of Parliament
and other relevant stakeholders. Additionally, we have placed the Letter in the public domain because of the widespread publicity
that your Report has since generated in the public domain. We really would have loved to have been given a chance to have
an audience with you during which we would have set the records straight. However, it is not too late and so, in the light
of the facts as spelt out in this letter and its accompanying attachments, we now humbly call on the ACC to review their position
towards our reputable company’s noble efforts in this beautiful country of Sierra Leone.
Sir,
accept the assurances of our highest possible esteem for you and your noble Commission.
Mrs. Chinwe Chiji-Nnorom Chief Executive Officer Income
Electrix Limited | Dr. B. B. Ratha Chief
Operating Officer Income Electrix Limited |
CC:
The Secretary to the President
The Honourable Speaker of Parliament
The Chairman
of the House Committee on Energy & Power
The Attorney-General
The Minister
of Finance & Economic Development
The Minister of Energy & Power
The Chairman, National Commission
on Privatization
The Chairman, Board of National Power Authority
The
General Manager, National Power Authority
The President, Sierra Leone Association of Journalists
Civil Society Organizations in Sierra Leone
The Press and Mass media
APPENDIX 1
Clause Number | Concerns Raised & Addressed |
1 | The contract is for the provision of 25MW of continuous
power to be delivered at two sites designated by NPA. GOVT. COMMITTEE POSITION: Govt. of Sierra Leone (GoSL) cannot afford 25MW. The 25MW should be stepped
down to 10MW currently running. The Provincial 11.1MW should be on hold. Govt. is looking for a different timeline
and its project execution will still depend on affordability. Comment: We can not step down the capacity from 25MW to 10MW as the entire contract capacity
of 25MW is already in Freetown. As a matter of fact, 34MW capacity to produce 25MW continuous is already
on ground in SL. 13MW already installed and working. 21MW yet to be installed because
of issues with the land at Imatt and also the inability of the NPA/GoSL to honour her performance obligation.
These machines were acquired with borrowed funds, which already are accruing huge interest charges. The
systems were configured and custom built to meet the requirements of SL. NPA/GoSL should therefore be thinking
of constructive solutions to address the problem. The issues are really improvement of transport capacity
to be able to convey the entire generated power to the consumers; improvement in revenue collection, by putting in place an
appropriate revenue cycle management strategy; the implementation of an appropriate cost recoverable tariff, etc.
There could also be discussions on concessions and specific target customer segments. Please look
for appropriate solution. Stepping down 10MW would mean killing Income Electrix Ltd which is not the only
available solution. The GOSL is liable for any default in payments by NPA to IEL GOVT. COMMITTEE POSITION: GoSL cannot guaranty any default by NPA. IMF has prohibited the GoSL from entering into certain financial or commercial
dealings like this one. Comment: The contract signed by NPA and GoSL says that GoSL will guarantee
the performance obligations of NPA. However, IEL is open to GoSL transferring her performance obligations
to a third party, if the third party has the capacity. |
2.1.3 | The Date of Commissioning the plant is defined as the date when the power station is connected to
the NPA system. GOVT. COMMITTEE POSITION: GoSL wants the date of commissioning which was given as 12/02/08. They want to know
whether there was formal notification to NPA and certification by NPA. Comment: Yes that is the date of commissioning. Notification and certification by NPA was not a provision
in the contract. However, NPA was duly notified before the plant was commissioned by the President. |
2.3 | The contract is for a period of three years. If the contract is terminated for any reason the capacity
charges is payable for the entire period of the contract. GOVT. COMMITTEE POSITION: GoSL wants to have the right to terminate the contract at anytime
based on affordability. Comment: GoSL cannot terminate the contract
at anytime, as there is a minimum period for the contract to be worthwhile to us. The equipments are brand
new, built specifically for SL. We need to recover at least a reasonable amount of the investment.
The contract could however only be terminated due to non performance of IEL. Clauses for the reasonable
termination can however be inserted in the contract. |
2.5 | The Capacity Charge (the flat charge for the rental of
the generating plant) is levied “irrespective of the operational status of the Plant” and is payable from “the
day that the equipment is delivered to Freetown Port”. GOVT. COMMITTEE POSITION:
The capacity charge should not be
based on the phrase “irrespective of the operational status of the Plant” and is payable from “the day that
the equipment is delivered to Freetown Port”. And payable should be as from the commissioning date and NOT from “the
day that the equipment is delivered to Freetown Port”. Comment: Yes, if any non-operational status is due to no fault of IEL. The capacity charge should commence
from date of equipment delivery to Freetown. In the case of the 10MW we can accept it
to be the date of commissioning. For the 15MW, the equipments have been
on ground yet none of the obligations of NPA has been met. The site of the 15MW is yet to be officially
handed over to us. So the capacity charge has to commence from the date equipments are delivered at the storage location. |
2.7 | The Energy Charge (to cover the cost of maintenance, etc.) is based on the actual energy consumed
or the minimum daily off-take, which is defined as the full contracted amount of electricity (that is the plant running at
full capacity for 24 hours per day for the contract period), whichever is greater. GOVT.
COMMITTEE POSITION: Energy
charge should be based on actual power taken. Comment: Yes –
the minimum off-take is the contract capacity. The installed capacity is higher than the contract capacity.
The inability of NPA to off-take the contract capacity cannot be to the charge of IEL. |
5.1.5 | The cost
of mobilization and installation of the two plants, which must be met by NPA, is US$ 2.45 million. GOVT. COMMITTEE POSITION:
They want justifications for this figure and the reason why air freighting did not meet the intention, commissioning
was done almost two months after air freighting. Comment: It was agreed
between IEL and NPA that 10MW be air freighted to meet the President’s pronounced date of 20th Dec. 2007.
Actual freight cost about $3.5Million dollars, IEL subsidized the air freight with $1Million. Late
commissioning was due to NPA/GoSL not meeting their performance obligations. No fault of IEL. |
5.1.6 | The demobilization and removal charges, which must be met by NPA, are US$275,000 “or the current
market price”. GOVT. COMMITTEE POSITION: It should be stated which one takes precedence. And the definition
of market price. Comment: The market price takes precedence.
Market price is actual cost of land transport, sea freight and clearing charges + duties at new destination. |
5.1.7 | The cost of site preparation, which must be met by NPA, is US$179,000 metering is undertaken by
IEL alone. GOVT. COMMITTEE POSITION: There should be justification for the civil cost. Comment: Civil cost much higher than $179,000. If you require breakdown, it
can be provided. |
5.1.18 | Metering is undertaken by IEL alone. GOVT. COMMITTEE
POSITION: There
should be provision for check meters by NPA and reconciliation. Comment: Metering is done by NPA and IEL and not IEL alone; check meters can be provided for a cost, if it is needed. |
6.8 | All duties, taxes, fees and charges and “any legislative modification with financial implications
on the contract shall be waived by NPA/GoSL” GOVT. COMMITTEE POSITION: These go beyond what GoSL can offer. GoSL
will provide what is affordable. Comment: The contract says the project shall
be free of all duties. However, if you require these to be paid, it shall reflect on the rates.
It is just a billing strategy; these could be buried in the rates. |
6.10 | This clause provides that “Supply of fuel been separately charged and is
stipulated in table 2, “The clause also specifies the “the price of fuel is subject to fluctuation” GOVT. COMMITTEE POSITION:
More explanations are required for table 2 (fuel charge computation table. Global Trading Group of Kingtom Power Plant
has a computation of three pages which ca be made available to IEL. Fuel charge is the biggest billing item to GoSL and should
be explained in details. Comment: The number of pages of computation
is irrelevant. Please lets have your issues here. The fuel computation is in table 2. |
7.9 | NPA is required to take “minimum energy …. Which is 100% load of the continuous power
being supplied.” GOVT. COMMITTEE POSITION: Again, affordability is the main issue. There is the need
for flexibility. Comment: Minimum energy is 100% of contract
capacity, not installed capacity. Less than that will result in gross loss for IEL. |
7.10 | This clause provides that “NPA shall provide logistic charges for fuel storage and transportation
charges…” GOVT. COMMITTEE POSITION: There seems to be double billing. Logistics is included in
fuel charge computation. Comment: There is only one fuel logistics
charge; that is the fuel computation. |
8.1 | NPA is required to “establish two confirmed irrevocable
letters of credit for the full amount payable to IEL annually with a reputable international bank acceptable
to IEL. GOVT. COMMITTEE POSITION: If letters of credit are opened, why is there need for Govt. guaranty since
payment is in advance. GoSL cannot guaranty any default by NPA. IMF has prohibited the GoSL from entering into certain financial
or commercial dealings like this one. Comment: We require a back-up.
However, GoSL can get a 3rd party to take over her obligation. This position can however
be discussed. |
8.2.6 | The penalty for late payments by NPA is LIBOR plus 7.5%. GOVT. COMMITTEE POSITION:
The percentage is too high, when the Kingtom Global Trading Group power plant is only 1.5%. Why
the delay penalty if irrevocable letters of credit are opened. Comment: Global Trading Group’s Project is a World Bank project which should attract very low financing costs. Financing
costs for a non-creditworthy client like NPA is much higher. |
8.3 | The capacity
charges are paid monthly in advance and the Energy charge monthly in arrears. The fuel charge is paid monthly in advance but
with two months being paid “at the inception of the contract,” GOVT. COMMITTEE
POSITION: If payment
for fuel is advance, then at what price? Is it present price or projected price. This will require agreement on both parties
to implement. Comment: The extra one month charge is for
strategic fuel reserve. The fuel cost is current platt price plus logistics. The modalities
can be discussed. |
8.4 | In addition to the general guarantee provided by GOSL under clause 1 and the letters
of credit established by NPA under clause 8.1, the Government is required to issue a bank guarantee to IEL to ensure payment
of any amount unpaid by NPA and outstanding for more than 60 days. GOVT.
COMMITTEE POSITION: GoSL
cannot guaranty any default by NPA. IMF has prohibited the GoSL from entering into certain financial or commercial dealings
like this one. Comment: GoSL can get a 3rd party to guarantee default by NPA. |
8.5 | NPA is granted a “moratorium” for five months after commissioning on all charges due
to IEL except for fuel charges. GOVT. COMMITTEE POSITION: They want to know if the five month moratorium is spread
over 12 months which had an affirmative as answer. Comment: Yes, the
5 months moratorium is spread over 12 months. |
| NPA is required to pay for insurance for IEL personnel and equipment. The estimated
cost is US$250,000. GOVT. COMMITTEE POSITION: The plant belongs to IEL which is being operated and maintained
by them, why should GoSL be responsible for insurance. Comment: Again, this
is a billing technique. The insurance can be hidden in the charges or charged separately as we did. |
14.3 | If the contact is terminated for any reason, NPA must pay the capacity charge to IEL for the remainder
of the contract. GOVT. COMMITTEE POSITION: GoSL cannot afford this. Comment: That is the case, so do not terminate contract arbitrarily unless due to non performance
of IEL as there is a minimum for which IEL would not sustain huge losses. |
14.1.14.17 | NPA is
allowed to terminate the contract only in the case of a delay in commissioning the plant in excess of 12 weeks after the plant
is delivered to the site or in case of force majeure. GOVT. COMMITTEE POSITION: GoSL should have the right to terminate anytime. Comment: Yes that
is the condition of the contract. However, if you have other specific conditions for which you think the
contract can be terminated, these can be discussed. |
19 | IEL’s obligations
under the contract are dependent on NPA obtaining approval from its board for the contract, confirmation that authorization
to import all equipment has been obtained and the establishment of the two letters of credit under clause 8.1 GOVT. COMMITTEE POSITION:
IEL should look at this clause carefully and its implications. Comment: Yes, IEL obligations, not NPA’s obligations; I also suggest you look at the clause carefully. It
is for IEL protection, not NPA’s. |
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