Bangladesh is suffering severe power shortages (1400MW peak power deficit), as no new IPP power plant has been commissioned in over five years due to corruption of the procurement process.
The World Bank asked IFC to provide advisory services to ensure a transparent, competitive bidding process for the next IPP - a 450MW base load gas fired IPP. A mandate agreement was (after much delay) signed in January with GOB. This was a lengthy and protracted process, but made possible through close WB and IFC collaboration. A similar contract for 10 small power plants for the rural system has been cancelled or postponed.
In addition, Petrobangla has expressed interest in IFC advising them on the issuance of a Third Round of Gas Exploration Licenses. IFC has a number of concerns regarding the current approach, including the lack of review of the fiscal reform package; the possible exclusion of a pre-qualification process; the lack of clarity on exportation of gas; and the inclusion of area in dispute India and Burma. IFC’s proposal seeks to address these issues so that the process is viewed by potential investors as both transparent and technically sound.
Government of Bangladesh has request IFC advice on future options for Biman Airlines. A formal mandate is under discussion and it is hoped to be signed soon.
