BK protests $3.5B Mazaruni prison contract

-cites ‘overnight’ change in engineer’s estimate

BK International Inc has lodged a protest with the Public Procurement Commission (PPC) over the award of a $3.5 billion contract for the expansion of the Mazaruni Prison and a key part of the company’s complaint is the alleged “overnight” increasing of the engineer’s estimate for the project from $2.8 billion to $3.1 billion.

In the wake of deadly unrest last year and in 2016 at the Camp Street jail in Georgetown, the APNU+AFC government has come under intense pressure to improve security and ease overcrowding at key facilities and the Mazaruni expansion constitutes the most significant reform. It is unclear what impact the BK protest will have on the execution of the project.

According to documents seen by the Sunday Stabroek, BK began expressing concerns about the bidding process on December 29th, 2017 to the Permanent Secretary of the Ministry of Public Security, Daneilla McCalmon.

However, by then, a decision had already been made. On December 30th, a Ministry of the Presidency release said that Cabinet at its December 27th meeting had taken notice of the award of the $3,562,081,575 contract for the Mazaruni Prison to Kee-Chanona Ltd of Trinidad in a joint venture with local company, NABI Construction Incorporated.

BK wrote to Chairman of the PPC Carol Corbin on January 10th this year, lodging a protest over the award of the project to the Trinidadian company and followed this up on January 11th with another letter supplementing its information.

On December 29th, BK Managing Director Brian Tiwarie wrote Permanent Secretary McCalmon, making the allegation that there was a mysterious expansion of the engineer’s estimate by around $386 million at the point at which the bids were opened at the National Procurement and Tender Administration Board (NPTAB) on November 21st, 2017. Tiwarie said his company had responded to advertisements in the national newspapers of the project under the heading `Completion of the Mazaruni Prisons, Mazaruni, Region #7 – Guyana Prison Service, Ministry of Public Security.’ The closing date for bids was November 21st at 9 am, at which point all bids would be opened. The engineer’s estimate for the project at this point was $2.8 billion as stated in the addendum to the advertisement of November 20th, 2017 in the Guyana Chronicle.

An overhead view of the Mazaruni Prison. The works on the prison include the renovation of the Bachelors’ Quarters, trade shop, the dormitories, living quarters, spinster quarters and the senior bachelors’ quarters at the prison. (Department of Public Information photo)

Tiwarie said that at the opening of the bids on November 21st, it was announced that five contractors had bid: BK International Inc at $2.517 billion, Chung’s Global Enterprise at $2.729 billion, R Bassoo & Sons at $2,439 billion, Courtney Benn at $2.585 billion and Kee-Chanona and NABI at $3.562 billion. Significantly, Tiwarie said that the Engineer’s estimate at the opening of the bid was hiked to $3.185 billion.

In his December 29th missive, Tiwarie lamented that 38 days had passed since the opening of bids and his company had received no communication on its bid, which he argued was a breach of the Procurement Act.

“Moreover, my company was informed unofficially by several frustrated officials that attempts are being made to award this contract to a company with a foreign background and for a price which is in excess of $1 billion over my company’s tender price,” Tiwarie asserted.

He said that this was also nearly $400 million in excess of the new engineer’s estimate of $3.1b. Tiwarie asserted that his company had met all of the criteria in the bid document. Furthermore, he said that the company has a “diverse operation” and that its quarry located only five minutes away from the Mazaruni Prison. He further said that BK had two mobile concrete plants, which would be installed along with an offer from Trinidad Cement Limited for the construction of a mobile cement plant.

“We are very uneasy in not hearing anything concerning this matter and as a consequence, my Company is taking this opportunity to formally lodge its protest [should the information received by us that the award was made to another company be true] and we now formally do so.

Tiwarie attached documents supporting his contention and his letter was copied to Minister of Public Security Khemraj Ramjattan; Minister of State Joseph Harmon; Minister of Finance, Winston Jordan;  Chairman of the NPTAB Berkeley Wickham; and Chairperson of the PPC, Corbin, among others.

On January 3rd, 2018 McCalmon wrote Tiwarie, advising him that his company’s bid had been non-responsive for the following reasons:

  • No evidence was submitted to indicate that any project of a similar size and complexity had been undertaken by BK;
  • No detailed work programme was submitted;
  • No method statement was submitted;
  • A list of outstanding projects currently being done by BK was not tendered.

Tiwarie replied the very day to McCalmon.  He stated that all four of the matters referred to by McCalmon had been addressed in BK’s bid document. He further noted that the company’s other significant contention was the “change of the Engineer’s Estimate overnight” from $2.8 billion as published in the addendum to the advertisement of November 20th, 2017 to $3.186 billion on the following day, November 21st, when the bids were opened at NPTAB.

“It is against this background that I am formally protesting/complaining of the award of this contract…,” he said.

This letter was also copied to Corbin and Wickham.

On January 11th, 2018, BK wrote Corbin contending that its bid had been responsive and raising concern over the change of the engineer’s estimate. Tiwarie told Corbin that BK was “eagerly awaiting a response to this grave concern.”

Since its establishment last year, a number of high-profile cases have gone before the PPC.

 

 

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