Prior and after construction, the project continued to attract a number of court cases, inquiries, investigations, audits, and political and commercial disputes.
The plant collapsed after 5 days of operation,[4] launching a series of inquiries ordered by then prime minister Nawaz Sharif.
[6] In order to make the project viable and to reduce annual losses, it was finally decided to convert the plant to RLNG.
[11] In September 2012, the president of Dongfang Electric Corporation, Zhang Guorong, terminated the contract for the construction of the Nandipur Power Project, saying his company had suffered losses worth $85 million.
[17] However, the plant remained operational for only five days after the inauguration and had to be shut down due to mismanagement, conflicts with the National Electric Power Regulatory Authority (NEPRA) over high production costs, and the use of inappropriate fuel.
[19] It was revealed after the audit that: [20] [21] Since the inauguration of the project, the plant became the highlight of media criticism and opposition parties have raised questions around it, causing political damage to the government.
After the revelation of an audit report and inquiry outcomes in October 2015, Nawaz Sharif took immediate action and changed the administration of the project.
The control of the project was handed over from the government of Punjab the Ministry of Water and Power, and controversial managing director Cap.
[22][23] Minister of water and power Khawaja Asif publicly admitted the failure of the project due to administrative lapses and mismanagement.
[33] Federal Secretary of the Ministry of Water and Power Mohammad Younus Dagha admitted that a gas-fired plant in Punjab, which suffered gas shortages in 2008, was a bad idea in the first place, and running it with regular losses was adding further insult to injury.
In late 2016, the Economic Coordination Committee (ECC) finally approved a loan of Rs 30.6 bn to convert Nandipur to gas operation.
In September 2016, most critical record of fuel payments and other multi-million rupee embezzlements were torched despite tight security arrangements.
[45] In the same month, a Pakistan Electric Power Company team dug into the damage done to the records, and found that most of the alleged proof of corruption was destroyed.
[51][52] The NAB launched an inquiry amid complaints raised after the AGP reported accounting escalations in cost, allegations of corruption and irregularities, and violations of procedures within the project.
[53] However, the inquiry faced serious hurdles after critical records were destroyed by the security apparatus inside the plant on unknown directives.
[42] The inquiry stalled for two years before the public accounts committee (PAC) directed the NAB in October 2017 to complete the pending probe of the Nandipur project and to expedite its investigation over the multi-million corruption scam.
[54] In December 2017, the NAB filed a reference of corruption and alleged misappropriations within Nandipur along with the illegal construction of a road to the Sharif family residence.