Auditor General probes controversial GPL contract to Chinese company

Feb 02, 2017 News

Auditor General, Deodat Sharma

Despite assurances by Government that all is well with a multi-billion-dollar smart meter deal and new transmission lines project, the year-long issue is refusing to die.
The matter is now reportedly engaging the office of the Auditor General.
Yesterday, Auditor General Deodat Sharma admitted that the matter has come to the attention of his office and the process will be scrutinised.
“That matter has been ventilated in the press and so we have been looking at it.” The official declined to go into specifics.
The $4.6B contract was green lighted by Cabinet late last year after months of questions over the delays and reports that Chinese-owned China National Machinery Import and Export (CMC) was tipped for it.
It meant CMC was being paid $1B over the Engineer’s Estimate of $3.6B.
CMC had undertaken a previous project to run new high-power transmission lines along the coast, build seven sub-stations and lay two underwater cables across the Berbice and Demerara Rivers to create a total network in the two counties.
However, a scathing report by supervising consultants criticised the submarine cable across the Demerara River noting that the company appeared to be a parts supplier before it was granted that US$40M project.
The Demerara River submarine cable was damaged under unclear circumstances last year leaving East Demerara with extra power from the new Vreed-en-Hoop power station.
This $4.6B contract, jointly funded by the Inter-American Development Bank and the European Union, and known as Component ‘A’ of the Power Utility Upgrade Programme (PUUP), came up this week before the National Assembly where Opposition’s Parliamentarian, Odinga Lumumba, debated a motion tabled by his colleague, Bishop Juan Edghill.
The motion was for the Guyana Power and Light (GPL) and Government, to abide by the procurement laws – among other things – to ensure that contracts are fairly and transparently awarded.
Lumumba said that this “particular scandal-prone project” should be taken to the Public Procurement Commission in order to find a resolution. The Government-side refused to entertain the request.
Already, one of the bidders, Fix-it Depot which partnered with Enrique Lourido from Colombia, has officially complained to the IDB and the Public Procurement Commission. They said that evaluators did not even consider the consultant’s report on the previous project handled by CMC.
Another bidder, Cummings Electricial, has reportedly complained also that the evaluation process was flawed.
Fix-it and its partner were the lowest bidder.
On Monday, Minister of Public Infrastructure, David Patterson, under whose remit electricity falls, claimed that price is not the only determinant in the award of a contract.
“There were local companies involved. I do not want to highlight deficiencies in anybody but I would like to highlight to this House of the requirements that were in the bidding document which all contractors will have to abide by…the average building of construction work over at least three years, at least 25 percent of the budget.
“What that means is that within the last three years, you must be able to demonstrate that you have done work to this amount– $970M; you must demonstrate that you won a contract to that amount. There were five bidders and two failed on that.”
He told the House that the appeals have been dismissed. “So the statements being made that we have been held up is incorrect.
These were the criteria that were set out by IDB and the EU and they were satisfied with the award.”

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