Jun 20, 2014 News
…during negotiations over Amaila Falls Hydro Project – NICIL says
The National Industrial and Commercial Investments Limited (NICIL), has come out in defence of gifting not one, but
two prime pieces of land to China Railway First Group (Guyana) Inc.
NICIL, headed by Winston Brassington, said that in early 2013, with the expectation of the Amaila Falls construction project starting later that year, “negotiations were held with China Railway First Group on key matters related to the start of the project.”
This, NICIL said, resulted in two pieces of land being committed to CRFG.
The government holding agency made this declaration via a missive yesterday in response to an article published in Kaieteur News on May 4, last. The article noted that Leader of the Alliance for Change (AFC), Khemraj Ramjattan, after checking the Official Gazette, discovered that NICIL had gifted a plot of Turkeyen land to the Chinese firm.
Ramjattan said that there was a double transfer of lands at Turkeyen from the Guyana Lands and Surveys Commission to NICIL.
He also explained that NICIL then transferred to CRFG, a piece of land. There was no cost attached to the land transfer.
The AFC Leader demanded that Government be transparent about the questionable transaction and explain why Lands and Surveys transferred the land to NICIL, and the said land was not sold to the Chinese group.
NICIL explained firstly, the key matters “negotiated” with CRFG, the first one being the Engineering, Procurement and Construction (EPC) Contract Price Validity.
“The price on the contract with CRFG executed in September 2012 and expired in June 2013. Given the expected delay of postponing Financial Close until the latter part of 2013, it was necessary to have the EPC price extended.”
The second “negotiated” matter was the Amaila Falls Access Road.
NICIL explained that the completion of the access road was a prerequisite to starting construction of the main project; local contractors were unlikely to complete the most difficult section of the road (Section 7) in 2013 and it was therefore considered wise to engage CRFG to complete the road, but at a reduced price to its tender.
“CRFG was already identified as the contractor for the Amaila Falls Hydropower Project and established as a much more experienced contractor. The satisfactory completion of the road was also, at the time, a critical component in meeting the deadlines specified for the Amaila Falls Hydropower Project.”
NICIL also said that in the first quarter of 2013, the CRFG agreed to and got Cabinet approval, for the construction of Section 7 of the road and extension of their price validity on the EPC contract.
There was a reduction of the amount of its original bid of US$11.2M to a cash contract price of US$8.5M; transfer by way of Deed of Gift, from government of 2 lots of land —1 acre at Liliendaal (completed) and 7.5 acres at Friendship (in the process of being transferred).
The CRFG would use the land at Liliendaal for building its Head Office and the land at Friendship for a materials marshalling yard and also a fixed price contract in preference to a measured works contract.
“The CRFG would extend the price validity of (EPC) Agreement for the Amaila Falls Hydropower Project from June 2013 to December 2013.
(Ongoing negotiations for the Amaila Falls Hydropower Project have resulted in the extension of the EPC price validity being extended to October 2014).”
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