CJIA contractor advanced US$20M

Sep 08, 2013 News

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– as CJIA’s political standoff continues

By Leonard Gildarie

The Chinese contractor hired to build a brand new terminal building and longer runway at the Cheddi Jagan International Airport (CJIA) is working with Government to finalise designs but the blocking of monies by the Opposition earlier this year has left the project in limbo.

The US$150M project, the country’s second largest project to date after the US$200M Skeldon Sugar Modernization Project, was thrown into doubt after the Opposition voted down $5.3B (US$27M), representing advances to the contractor.
Both the Alliance For Change (AFC) and A Partnership for National Unity (APNU) said they wanted more information on how the monies will be spent.
Already, China Harbour Engineering Company Limited (CHEC) is in the country and two months have passed since the June start date that was planned.
A Board member of CJIA disclosed that CHEC is currently mobilized and preparing the site office and accommodation for its employees. Actual excavation works for the new terminal building is expected to commence sometime in October 2013.
Last year, Government advanced US$20M ($4B), to CHEC representing 15 per cent of the contract price.
The project is being funded by a US$130M loan from China with the rest coming from the Treasury.
Government has insisted that the current runway is too short to attract larger, wide-body planes, and the terminal building too small to handle the passengers. There have been constant problems with sewage overflow and increasing complaints of the congestion by airlines like Caribbean Airlines.
A new terminal and longer runway will also allow Guyana to tap into markets of Asia and Africa because of the country’s strategic location at the tip of the South American continent, the government insists.
Last week, Transport Minister, Robeson Benn, said that he remained open for talks with the Opposition with the contractor already paid monies to start work.
Government would fear a repeat of the Amaila Falls hydro fiasco in which two pieces of legislation suffered defeat in the National Assembly, forcing the US developer to announce its pullout. That 165-megawatt project has been “killed” until another financier comes to the table.

Should the CJIA contractor be forced to pull out because of no monies, Guyana may very well have to compensate them for work done.
Earlier this year, CHEC had brought down a team to conduct critical soil tests. They have already procured equipments and with at least 10 technical staff stationed in the country at any one time.
Penalties, hurdles
The airport official said that any penalties that Guyana will face may have to be decided at the arbitration level.
In addition to wrangling at the political level, the airport expansion has also been facing hurdles from another direction.
Several homes and shops located in the vicinity will have to be moved to make way for the extended runway and expansion. In February, Government said it counted 325 homes with about 60 of them in the critical areas.
The Ministry of Public Works said that talks are ongoing with these 60 homes. The residents, some of whom claim to be living there for over 30 years, are refusing house lots offered to them. They say that they want more information on plans to compensate them. This week, there will be meetings with the other group of residents.
Several shops located along the roadway leading to the current terminal are also slated to be removed.
The CJIA official said that the airport remains “very optimistic” about this project – there is too much to lose if it were to be cancelled. No airline would bring larger aircrafts if the terminal is inadequate to process their passengers in a timely manner.
“One of the main hallmarks of each airline is to process their flights and get the aircraft into the air in a timely manner. At the moment we struggle to process passengers during the peak due to capacity constraint – CAL can easily verify this. It makes no sense extending the runway without having the terminal capacity to handle the additional passengers.
No talks
Yesterday, AFC’s Leader, Khemraj Ramjattan, when questioned about the Opposition’s backing of the project, said that there has been no word recently from Government on the issue.

“We would like to continue forward with the development of this country but the Government continues to behave like a majority despite being in minority. It can no longer be a situation of doing as we please. We have to find consensus. They have provided information which at best is sketchy.”
Under the contract, CHEC has 32 months to complete the project. Government has also decided to keep the current terminal building and not tear it down as was indicated before.

 

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