Project authority cites short of cement supply; Dungsam cement says it has been meeting about 95 percent of the supply order

A short supply of cement during the last one and half months has affected the work progress at the Mangdechhu hydropower project in Trongsa, the project’s managing director, AK Mishra claims.

Earlier, the project authority had extended the commissioning date of the 720-megawatt project from June to September 2018.

Citing the lack of adequate cement as one of the main reasons for the delay in the completion, AK Mishra said that the project authority would start commissioning the project by November. “The short supply has already affected the work progress,” he said.

According to the details provided by project officials, while the cement requirement for April was 13,500 metric tones (MT), the project claims that it received only 4,004MT, which is 30 percent of its requirement.

The supply, however, has improved marginally and as of May 20 the suppliers met 68 percent of the total requirement. This means that the project received 6,915MT out of the total requirement of 10,100MT for the first 20 days of this month.

AK Mishra said that about 96 percent of the works have been completed.

“All the remaining works now are concrete works. However, we have faced a severe shortage of cement for more than a month although supply has stabilised,” he said.

He claimed that the disruption in the supply has affected the project’s ability to build up a reserve for the upcoming monsoon when road blocks are expected.

On an average, the project requires about 400 to 500MT of cement a day, according to officials.

The Dungsam Cement Corporation Limited (DDCL), a subsidiary company of the Druk Holding and Investments (DHI), supplies cement to the project.

A DHI official requesting anonymity said that it earlier was agreed in a high level meeting between project officials and DHI that the project would maintain a buffer stock to meet the requirement during crunch time.

The official also said that the company has been meeting about 95 percent of the supply and that the project authority could have met the remaining five percent of the requirement from other sources or from the buffer stock, if they had maintained.

“We have done excellently from out part,” the official said.

However, he said that the two companies carrying out the work – Jaiprakash and Gammon companies – owe Nu 143.29 million and Nu 59.47 million respectively to the DCCL as of May 20. These outstanding, according to the officials, have crossed the credit period of 45 days.

DCCL has been availing credit from banks to meet the working capital at the interest of 15 percent. “We have to buy raw materials and pay for other expenses,” he said.

DCCL has tendered out the transportation works to transport companies, which either deploy their own trucks or hire trucks from private individuals.

One of the transport companies, Dophu Transport, said that he has started to supply cement and that he already has more than a dozen trucks at work.

However, the chairman of the Truckers’ Committee of Bhutan, BB Tamang, claims that it was the unavailability of trucks for hire that has been affecting the supply of cement. The existing rates for transportation, he said, are not profitable for truck owners to hire their vehicles.

He said the cost of transportation from DCCL to the project site is Nu 1,696 per MT via Panbang and Nu 2,170 per MT via Gelephu.

“If the transport companies want to hire our trucks, we cannot afford to give at a low transportation cost,” BB Tasmang he said.

Officials from the DHI, the Mangdechhu project and the truck committee members met at Nganglam in Pemagatshel last week to resolve the issue. “The stakeholders requested truckers’ help for supply of cement,” the committee chairman said.

However, he added that issues such as low transportation cost and the need to produce a no objection certificate from other transport companies still remain.

Meanwhile, the DCCL on April 26 issued a notification to three transport companies – M/s Choden Transport, M/s JD Transport and M/s Transport – asking them to deploy adequate numbers of trucks to meet the supply requirement at the Phuentsholng and Gelephu depots.

“It was observed that the transporters were not able to achieve the daily target,” the notification stated. “We would like to understand that the stock at both depots has been completely depleted and our customers have been following up with us on a daily basis.”

MB Subba