The government is concerned at the delay in the departure of power ship carrying 231 MW plant at Port Qasim established by Turkish firm Karkey Karadeniz Elektrik Uretim despite obtaining an NoC from the Sindh High Court (SHC), well informed sources told Business Recorder.
"We think that M/s Karkey intends to impose penalty through International Centre for Settlement of Investment Disputes (ICSID) on the plea that GoP delayed the departure of the vessel. But we have completed all formalities and intimated the court order to the Turkish firm and sent an NoC for departure from the Pakistani waters," said an official on condition of anonymity.
M/s Karkey Karadeniz Elektrik Uretim moved the ICSID, claiming $2.1 billion damages against the government of Pakistan. National Accountability Bureau (NAB) recently arrested three top officials including Managing Director, Private Power Infrastructure Board (PPIB) due to their alleged involvement in financial scam of Karkey rental power plant.
NAB has also filed a reference in the Accountability Court, Rawalpindi, against former Prime Minister Raja Pervez Ashraf who approved the project as Minister for Water and Power. According to Karkey's statement, an independent international expert has estimated $2.1 billion as the total amount of damages Pakistan may be liable to pay to Karkey as a result of "unlawfully" detaining the company's power ships and energy-producing vessels. Karkey is seeking a compensation from Pakistan for breach of its obligations under the bilateral investment treaty (BIT), breaches of international law, and defiance of ICSID provisional measures order, in connection with Karkey's investment in a rental power project (RPP) in Karachi.
In response to its treatment by Pakistani authorities, including the ongoing detention of four of its vessels, the Turkish energy firm, Karkey Karadeniz Elektrik Uretim AS (Karkey), had registered a claim with the World Bank-affiliated ICSID against the government of Pakistan in the beginning of 2013. The initial contract value of Karkey's powership operations in Pakistan was $560 million for the duration of five years. The claim, as calculated by experts, should sum up the damages obtained as a result of the loss of earnings and costs associated with the detention of its vessels. Karkey's vessels have been detained in Pakistan since April 2012.
The government changed the law firm representing Pakistan at ICSID against 231 MW Turkish power ship of M/s Karkey Karadeniz Elektrik Uretim after the law firm hired initially failed to deliver. After consultations with the Attorney General of Pakistan, Water and Power Ministry replaced BLP law firm with Allen & Overy. According to sources, Water and Power Ministry is updating the newly hired law firm on developments on the case.
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