BEIRUT: Despite the ongoing dispute between the government and Karadeniz Holding, the Turkish firm supplying power to Lebanon through electricity generating barges, a second vessel is reportedly set to arrive in Lebanon Monday.
The Orhan Bey, the second floating power station in the seven-ship fleet owned and operated by Karadeniz, was due to arrive in Lebanon in June, but was delayed due to what one company source called “technical issues.”
The barge set sail for Lebanon on July 30. Karadeniz’s first ship, the Fatmagul Sultan, has been moored off the shore of the Zouk electricity plant since April, but suspended production for one month shortly after arriving, citing the poor quality of fuel supplied by Electricite du Liban.
The perpetually cash-strapped, state-owned electricity monopoly has claimed that Karadeniz is requesting a higher quality of fuel than the grade specified in its $390 million contract with the government.
Though the Fatmagul resumed production in June after Karadeniz conducted the repairs on the ship, a report released last month by Lebanon’s Central Inspection Committee said the dispute over the quality of fuel oil supplied to the Fatmagul and the delay of the Orhan Bey were likely linked.
The committee urged the government to seek compensation from Karadeniz for the suspension of production and said it should resort to international arbitration if necessary. Caretaker Energy Minister Gibran Bassil has said Lebanon is entitled to $82,000 per day in delay fees.
Separately, an EDL source told The Daily Star last week that the judiciary was in the process of investigating the delay of the Orhan Bey.
Karadeniz has been embroiled in a legal battle with the government of Pakistan for more than two years over a similar contract to provide power to the country through its offshore barges.
The government filed a lawsuit in Islamabad seeking $600 million in compensation from Karadeniz for alleged breaches of contract and followed up by seizing two of Karadeniz’s ships.
The Turkish firm countered by filing a suit against Pakistan at the World Bank’s International Center for the Settlement of Investment Disputes in February which is currently in the midst of arbitration.