The $3.5 billion contract for the Mazaruni Prison expansion, over which BK International Inc. has lodged a complaint with the Public Procurement Commission (PPC), will be executed as planned, according to PPC Chairperson Carol Corbin.
“The law says that once the contract has started, you cannot have an administrative review,” Corbin told Stabroek News yesterday. “A PPC finding will guide the contractor on what their next action is. If they do nothing or take some other step. Whatever we come up with, it will just support whatever they do. If we determined something that was done should not have been done, that gives them substance to take the matter further,” she added.
BK International Inc. last week lodged a protest with the PPC over the award of the $3.5 billion contract and a key part of the company’s complaint was the alleged “overnight” increasing of the engineer’s estimate for the project from $2.8 billion to $3.1 billion.
But Corbin explained that while the investigation is only in its preliminary phase, it must be made clear that an engineer’s estimate was never given when the project was advertised but a “cost estimate” from the procuring entity.
“Their primary contention is that the engineer’s estimate was changed overnight, just prior to their submission of the tender. They have received notification from the procuring entity that they were not awarded the contract because of certain issues. They have written the procuring entity, the procuring entity responded to them and advised them that they were not awarded the contract and gave them the reason why. So their main contention is that the engineer’s estimate was changed within a very short timeframe just before the opening of the tender,” she noted.
“But in actual fact, the engineer’s estimate is opened at the same of the time with the tenders. So what they had seen in the ad was a cost estimate for the project. It was not specified that was the engineer’s estimate. So far, the information is there was a cost estimate that was advertised but the engineer’s estimate was opened at the same time that the tender documents were opened and that engineer’s estimate was different from the cost estimate. That is information we have so far and we are following up right now to confirm all of those issues,” she added.
When the Department of Public Information announced on October 17th, 2017, that bids were out for the project, it stated that the estimate was pegged at $2.8 billion.
But on December 21st, when tenders for the project were opened at the National Procurement and Tender Administration Board (NPTAB), the Engineer’s estimate was announced as $3.185 billion.
Five companies had bid for the project:
At a post-Cabinet press conference on December 29th, Minister of State Joseph Harmon announced that the joint venture between local company Nabi Construction and Trinidadian Kee Chanona Limited had been awarded the contract.
According to documents seen by the Stabroek News, on the same day BK began expressing concerns about the bidding process and had written to Permanent Secretary (PS) of the Ministry of Public Security Daneilla McCalmon.
In the company’s correspondence to the PS, written by BK’s Managing Director Brian Tiwarie, it was alleged 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 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. He said the engineer’s estimate for the project at this point was $2.8 billion as stated in the
to the advertisement of November 20th, 2017 in the Guyana Chronicle.
Tiwarie noted that at the opening of the bids on November 21st, the engineer’s estimate was hiked to $3.185 billion.
In his December 29th letter, 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,” he asserted.
He said that the awardee’s bid was also nearly $400 million in excess of the new engineer’s estimate of $3.1 billion. 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 and that BK also 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.
On January 3rd, 2018 McCalmon wrote Tiwarie, advising him that his company’s bid had been non-responsive as there was no evidence submitted to indicate that any project of a similar size and complexity had been undertaken by BK, no submission of a detailed work programme, no submission of a method statement or a list of outstanding projects currently being done by BK.
Tiwarie replied the very day to McCalmon and 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.” “It is against this background that I am formally protesting/complaining of the award of this contract…,” he said.
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.
Corbin said yesterday that when the PPC’s decision is made, the agency will inform both the procuring entity and the company.
“When I make a decision, I will inform them and if there are any breaches that the procuring entity made, we will discuss those with them and identify them if that is so,” she informed.
She noted that if the company does not find the PPC’s decision favourable, it can go to court in the absence of a constituted Public Procurement Tribunal.
“…They are allowed to go to the Public Procurement Tribunal to deal with that but it has not been set up specifically to deal with that and it is not established as yet but the law is there. They can take it to the court… but we don’t want to anticipate because we are in the initial state of the investigation,” Corbin said.