Leguan Stelling contractor officially given the boot

Feb 28, 2021 News

The Leguan Stelling which has been under repairs for the past two year

Kaieteur News – The contractor for the $413M Leguan Stelling Rehabilitation Project has officially been fired from the job.
According to information obtained from the Ministry of Legal Affairs, the contractor, Satrohan Maraj, of Maraj Contracting Services, was officially notified of the termination of his contract on February 22.
In a letter, Minister of Legal Affairs and Attorney General, Anil Nandlall, S.C., outlined that the Government of Guyana, through the Transport and Harbours Department (T&HD), executed a written agreement with the company on September 20, 2018, for the rehabilitation of the Leguan Ferry Stelling in accordance with the terms specified in the said contract. The Attorney General (AG) noted that the contract was executed for $413,259,260 and was supposed to be completed on or before June 18, 2019.
Nandlall said that based on the records, the T&HD had granted several extensions of the contract, notwithstanding those extensions, the project has been delayed for approximately twenty months.
“Thus, the company has complied only a minimal amount of the schedule of works. As a consequence, your company has committed a fundamental breach of the terms of the contract and as result; the Government exercises its rights to terminate the contract with immediate effect,” the AG added in the letter.
Further, Nandlall listed the grounds of termination as a breach of the clause for failing to comply with the schedule of work and breach of clause 40.2 (G) and the special conditions of the contract for the inordinate delay in completion of works under the contract.
Added to this, the Attorney General said that the Government will enforce provisions of the contract regarding the performance bond of $43,325,926; the mobilization bond of $81,398,375; and the ten percent contract sum as liquidated damages and the value of the works not performed.
In addition, he noted that the Government reserves its right to institute legal proceedings against the company for compensation for the breach of contract and unjust enrichment.
Last week, the Ministry of Public Works (MoPW) announced that Minister of Public Works, Juan Edghill, met with the contractor, along with a team from the T&HD.
The MoPW noted in a statement following an 11-hour deliberation, which was guided by a report compiled by the Audit Office of Guyana, the team determined that the contractor “is incapable, unable, and does not possess the wherewithal to successfully execute this project valued at $413,259,260.”
The statement went on to mention that the contractor received payments totalling $199,435,000, almost 50% of the contract sum, an “unheard of scenario,” which it notes is outside of normal procurement practices and a breach of the Fiscal Management Accountability Act (FMA).
In addition, it was indicated that the contractor, having received the contract for the building of a stelling, used the argument of a faulty bill of quantities and earned himself by October 30, 2019, an additional $20,650,000 for the supply and delivery of piles for the same Leguan stelling. What is notable too is that the contract did not include piles, one of the most important components for the construction of the stelling.
The Auditor General, Deodat Sharma, had informed that at the time of the audit, the contractor was paid for measured works, but there was no break down attached to the payment certificates.
During the meeting, Minister Edghill, sought to remind that on four occasions, he had engaged the contractor and the Transport and Harbour Department on the completion of this project, which yielded no success. Against this background and in keeping with the contractual terms, the Minister announced that the contract will be terminated with immediate effect.

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