Sep 26, 2021 News
…claims no ‘mischief afoot’ but mulls scrapping Steel Sheets venture
Kaieteur News – The Ministry of Agriculture, one day after confirming it was mulling scrapping the controversial National Drainage and Irrigation’s (NDIA) stock piling of in excess of 300 steel piling sheets, announced that it has cancelled four other projects that it had also been retendering.
The decision comes amidst a flurry of media exposure by local, independent media houses and was first reported by this publication.
The Ministry in a public notice yesterday said it had cancelled the projects related to the construction of a pump station to irrigate the Black Bush front lands in East Berbice, a pump station at Cottage, Mahaicony, a Farm to Market Road in Mahaicony and the construction of drainage infrastructure in Georgetown.
As it relates to the controversial steel piling sheets venture, the Ministry in a public missive a day earlier, noted that it is in fact considering scrapping the project altogether, while insisting that there is no mischief afoot with regards the project.
Justifying its position, it noted that the increase in the global prices surpassed its budgeted amount. “There is and was no mischief afoot, efforts were made in this case repeatedly through open tender, however all failed so far,” the Ministry said.
This is despite the fact that the specific grade of steel being requested is being supplied by one company globally which has submitted a quote consistent with some of the bids received through at least three rounds of bidding earlier this month, August and July.
According to the Ministry, as a result the continued high prices and shipping costs for steel, the NDIA at this stage will have to consider a solution whether to proceed or to withdraw the project and wait for 2022 to see if the global shipping costs and the cost of steel will come down.”
The Ministry used the occasion to reiterate, “This issue was one of the exorbitantly high process for these imported material at the required specifications and insufficient budgetary allocations.”
According to the Ministry’s missive, it is awaiting the advice of the NDIA, “if it has an alternative solution to propose for its consideration under these circumstances.”
This publication had initially reported that the repeated retendering for several projects by the Ministry was not only unethical but tantamount to corruption and should be considered illegal.
It was explained that each time the Ministry puts out a tender for a contract—many of which runs into the hundreds of millions or billions—it would cost every person or company submitting a bid, hundreds of thousands of dollars for each bid submitted.
When the contract is opened at the National Procurement and Tender Administration Board (NPTAB) and retendered, at least one contractor who spoke to this publication on the condition of anonymity explained that it is tantamount to the State agencies providing insider information to their preferred bidders.
This obtains since after repeated retendering, the preferred bidders would be able to know the rates being charged by competitors and eventually be allowed to outbid the others.
It was noted too that when complaints are lodged requesting the rationale behind the refusal of a bid, these are oftentimes brushed aside or met with vague answers.
Additionally, Kaieteur News had reported that government had also been retendering for a project that can be sole sourced since the specifications being demanded by NDIA can only be supplied by a single company.
The Steel Sheet Piles, namely 327 pieces are specified at the requirement AZ 13-700 (D) ASTM A690 Steel Sheet Piles.
Kaieteur News has since been reliably informed by an insider, with intimate knowledge of the supply chain and process for the identified materials, that there is only one company that provides Steel Sheet Pilings at that specification.
The identified quality specification for the sheet piles to be provided, according to a quote seen by this publication from the sole supplier globally, Arcelor Mittal Projects, is listed as ASTM A690.
Arcelor Mittal is headquartered in Luxembourg, with the sales representative for Latin America, which encompasses Guyana sales, being Julian Guitierrez who works out of Torres Global Bank.
The quote provided by the company for the 10-metre long lengths of steel sheets, was provided at €751,285 or $184.7M, minus commission.
That quote was sourced by a ‘bidder’ participating in one such round in bidding that were had in August last, for the supply of the materials.
The Ministry subsequently responded to say it was not at fault since the retendering was a decision taken by the National Procurement and Tender Administration Board (NPTAB). The Ministry had, however, withdrawn that statement by the next day.
But NPTAB was swift to deny the position asserted by the Ministry stating that any retendering is had at the behest of the procuring entity.
It was explained to this publication that government could sole source the material for as little as US$1M when the related ancillary charges are added on.
Instead, the option to repeatedly retender for a specific type of material that can only be sourced from one supplier is raising eyebrows among some in the industry.
One such insider, speaking to this publication on the condition of anonymity, said it must be publicly questioned why it is that the Engineer preparing the project documents for NDIA insists on that specification for the steel sheet pilings since there are several other grades of similar steel sheet pilings that can be used for the same purposes indicated by the NDIA.
This coupled with the repeated retendering, according to the insider, “has to be questioned publicly since it can only point to the government setting the stage to have some favoured contractor to get the contract—a contractor that would eventually have to purchase the steel from the same company.”
The bidder cited as example, “if government was looking to purchase a Tesla vehicle, why would it go out to public tender when there is only one company in the world that makes Tesla vehicles.”
The August 10 round of bid openings, for which the international company supplied a quote at $184.7M, saw bids coming in from Platinum at $463.9M, Roopan Ramotar at $544.5M, STP Investments at $632M while Samaroo Investments’ bid came in at $654.7M.
Additionally, H. Nauth and Sons had submitted a bid for the supply of the steel sheet pilings at $465.3M while Aria Civil Works bid was $464.6M.
A previous round of bidding in July saw bids from Yunas Civil Building and Construction Services, which submitted a proposal at $183.7M, while Dax Contracting Services’ bid was $280.3M.
Samaroo Investments bid, which was in that earlier round of bidding, had also submitted a bid for $281.2M, while Fix It Depot submitted an offer of $277.5M, S. Jagmohan Construction and General Supplies Inc. at that time proposed supplying the materials for $254.1M, while Colin Talbot Contracting proposed an offer of $253.5M.
At the time, David Persaud Investments had proposed supplying the Steel Sheets to NDIA at a cost of $27.9M, some $253M less than the highest offer at the time. As it relates to the September round of bids submitted, Toolsie Persaud Limited provided a proposal for $294.6M, General Marine Company’s bid was $306.2M, Gafsons Industry Limited submitted a bid for $292.8M while Dax Contracting Services gave a proposal to supply the steel sheets for some $259.3M.
Other bidders in that round of the tender opening, saw proposals from Brinco Shipping and Trading Company Limited for $245.3M, David Persaud Investments Limited for $210.8M, Silica Sand Post Inc. at $272.3M, Fix It Depot’s $275.3M, GSK Excavation Service Inc. came in at $208M, Samaroo Investments’ bid was $251.6M, S. Jagmohan Construction and General Supplies Inc.’s bid was $219.6M and Yunas Civil Building and Construction Services’ was $259.3M.
It was also explained that each time the Ministry puts out a tender for a contract—many of which runs into the hundreds of millions or billions—it would cost every person or company submitting a bid, hundreds of thousands of dollars for each bid submitted.
Additionally, another of the projects under the auspices of the Ministry that has been the subject of retenders is for the rehabilitation of 18 kilometres of road at Ituni/Tacama.
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