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(Marwan Buhaider)
Before the collapse of the exchange rate, none of the contractors objected to receiving their quotas in lira, although the contracts specify the dollar as the contract currency. This is normal when the exchange rate was fixed, but after its price on the black market reached 8,000 pounds, in exchange for the stability of the official rate in 1515, it was no longer possible to fish the lira. And because none of the companies is willing to suffer such a loss, this seemed to pave the way for the possibility of legalizing the import of necessary equipment and spare parts, thus gradually stopping the work. The conversation here includes all levels of work: production, transportation, distribution and contracting.
In early summer, these companies breathed a sigh of relief. It was agreed with the Banque du Liban to insure some of its quotas in dollars. The agreement stipulated the division of payments between the dollar in cash, the dollar and the pound. It included all contractors, especially companies that operate and maintain laboratories, Turkish ships and service provider companies … But this agreement was short-lived. In the Ministry of Energy, it is confirmed that the Banque du Liban stopped paying, after appointing the deputies of the governor who requested to review these agreements. As a result, the service providers received only a new dollar or two. Turkish ships, due to the huge amount owed to them (about $ 150 million), received more payments. But all that stopped in October. Some associate this termination with the frequent conversations about termination of child support. The one who took charge of the transfers abroad was the deputy governor of the Central Bank of Lebanon, Salim Shaheen. He had questioned the possibility of companies transferring their profits abroad, asking for guarantees that this would not happen. Yesterday a meeting was held between representatives of the service provider companies and the bank, to try to respond to a series of observations made, and confirm that a third of the quotas that can be obtained in dollars are barely enough to insure the equipment necessary to maintain the continuity of distribution and ensure customer services.
Company sources indicate that the meeting was very positive, as the lieutenant governor affirmed his enthusiasm for the sector and its continuity. Faced with the bank’s fear of transferring corporate profits abroad under the pretext of paying international suppliers, it was agreed that the bank would transfer the required sums directly to suppliers, without going through service providers, noting that this agreement covers the current year and the next. Although the representatives of the companies left calm about the course of the meeting, one of them considered that the lesson is in the speed of implementation, because the more time passes, the greater their inability to carry out maintenance work and install equipment. The sources affirm that his words are not a threat, but rather the expression of a fait accompli suffered by all those who contract with the State.
The Ministry of Energy proposed reducing subsidies for gasoline (increasing its price) to finance the needs of the electricity sector!
The Energy Ministry reportedly proposed in coordination meetings to reduce gasoline subsidies by five percent (from 90 to 85 percent), provided that the funds that could be saved from the subsidy relief, estimated at $ 300 million annually, would be delegated to contractors that contract with the state. The excuse of the ministry is that this amount can guarantee the stability of the electricity sector, without the cost being high for people, since it is assumed that the price of a can of gasoline will rise between a thousand, a thousand and 250 pounds only.
The company “Carradins”, which has arrears from the state for 150 million dollars, equivalent to 10.7 million dollars a month, has previously written to the ministry requesting the fulfillment of the contract (payment in dollars). Sources report that the company, which supplies 27 percent of total electricity production, did not threaten to leave, but did hint at it. However, these sources confirm that the company will continue and all it requires is cooperation to maintain its ability to provide the service. Therefore, it was agreed that she would receive a third of her monthly payments in dollars, in exchange for the remaining two-thirds in dollars and Lebanese pounds. However, like others, this month he did not receive his installments in US dollars. Sources from the Ministry of Energy confirm that the Central Council has become stricter in monitoring the dollars leaving Lebanon. Therefore, the stop is related to making sure that the funds go away.
The turbines at Deir Ammar and Zahrani will need full maintenance by the manufacturer in the coming months.
The worst is yet to come. Prime South, which operates the Zahrani and Deir Ammar plants, and MEP, which operates the new Zouk and Jiyeh plants, are scrambling to procure spare parts to keep the sector running. The MEP, which has not received its dues for nine months, also wrote to EDL more than once. One complaint: We can no longer ensure the continuous operation of the laboratories due to lack of liquidity. Prime South, for example, faces a more serious problem. Although it shares the same suffering with the MEP, the fear that the Deir Ammar and Zahrani plants will be stopped is heightened, as they ensure the highest percentage of production. Thats not all. Previously, the CEO of Prime South met with the deputy governor of Banque du Liban, to urgently release a sum of money in fresh dollars. In the plants, in addition to periodic maintenance, the turbines are subject to comprehensive maintenance every 40,000 hours (between four and five years). This measure, according to the contract, can only be taken by the turbine manufacturer. November is the time for comprehensive maintenance on one of the turbines at Deir Ammar, while maintenance on two turbines will continue at Zahrani in the spring. This maintenance process costs 10 million euros per turbine, and is supposed to be prepared two months in advance. This did not happen, but the promise to pay the money earlier this month was also not kept. This entails the possibility of extending the extinguishing period of the turbine to more than two months (the turbine can be turned off in time even if maintenance begins, because its operation increases the damage that could be caused to it). The Energy Minister, in turn, confirms that the matter is urgent, but is waiting for the Bank of Lebanon.
When does the restoration of Lebanon’s Electricity begin?
Electricity workers in Lebanon are concerned about their fate. The inaction of stakeholders in the corporation’s management, the Ministry of Energy and the government, to restore the corporation’s central building before the onset of winter, raised many questions. Therefore, on the agenda of the Corporation’s Workers and Employees Union, at its ordinary meeting yesterday, a topic: “The fate of the workers and employees and the fate of the Electricity Lebanon central building after the catastrophic explosion of the August 4 and the negative effects it had on the institution building and its employees. The Union expressed its “apprehension about what is brewing for the workers, employees and the establishment after almost three months have passed since the explosion”, asking why the parties involved did not have an address to begin the restoration.
Thus, the Union gave all officials “an opportunity until the end of the current month to make the appropriate decisions to start the necessary reforms related to the central building, and if they do not perceive any positive aspect, the thing is based on it.”
On the other hand, the Minister of Energy, in his speech to Al-Akhbar, was surprised by the link between the fate of the workers and the fate of the central building, highlighting that the permanence of work was out of the question. Regarding the restoration of the building, he explained that this requires complex mechanisms and a high cost, since the restoration costs are estimated at 16 million dollars, as well as the reconstruction costs of the power plant that is located below the building. He said that the ministry is waiting for the financing issue to be resolved, whether it is secured through donors or through a loan obtained by the state. But in both cases, he indicated that even if the business started today, it would take about two years to finish. That is why the “EDL” distributed the workers and employees between the prefabricated rooms that were installed in the outer courtyard of the building and between the factories and stations … It also seeks to rent a new building to replace the central building until it is restored, noting that today a meeting is being held for this purpose. Large contractors, to demonstrate their ability to contribute to building equipment costs.
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