British firm fights NIB over contract for dam project - Beaking Kenya News

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Monday, 25 February 2019

British firm fights NIB over contract for dam project

High Grand Falls Dam

By KITAVI MUTUA
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The National Irrigation Board is on the spot over a Sh200 billion tender for a multipurpose dam in Kitui County.
A British firm embroiled in a dispute over the tendering wants the Public Procurement Administrative Review Board (PPARB) to compel the NIB to obey orders stopping it from manipulating the procurement.
Already, the NIB has been fined Sh250,000 by the procurement tribunal for disobeying orders regarding the dispute that has dragged on since May 2017.
General manager Gitonga Mugambi has until tomorrow to pay London-based GBM Engineering Consortium the fine in addition to reinstating the firm's Request for Proposal, which the NIB had disqualified.
This is after the agency ignored court orders issued on November 13 last year.
"The procuring entity shall pay to the applicant cost of this application an amount of Sh250,000, and shall provide proof of payment to the Board within 21 days," reads the ruling delivered on February 5.
MEGA PROJECT
The fine is an indictment of how the agency has handled the process and reinforces claims by the bidder that it is protecting some vested interests.
In the ruling, procurement board expressed regrets that NIB seemed hell-bent to manipulate the tendering and award the contract to a firm of their choice instead of giving all bidders an equal and fair chance.
PPARB chairperson Hussein Were cited NIB for contempt for ignoring numerous court orders and gave the general manager a further 14 days to first comply with last year's orders.
The British consortium was among seven pre-qualified international construction firms — five of them Chinese — which participated in the bidding under the fund, design, build, own, operate and transfer model of the multibillion shilling project.
The High Grand Falls Dam Project is the single-largest undertaking by the government after the Standard Gauge Railway, and is part of the Sh1.5 trillion Lamu Port-Southern Sudan-Ethiopia Transport Corridor (Lapsset) projects.
CONTEMPT
In terms of size, the proposed water reservoir in Kitui and Tharaka Nithi counties could be Africa's second largest after the Aswan High Dam in Egypt along the River Nile and Kenya's biggest dam, covering a massive 165 square kilometres.
This meant that NIB had no option other than to re-evaluate the specific components of the tender as directed and award the contract to GBM Engineering on or before March 15.
However, in a letter dated February 14, Mr Mugambi once again disregarded the tribunal orders and instead dismissed the whole tender, saying the British firm's bid had failed in the fresh technical evaluation.
"Your tender failed in the technical evaluation stage because you didn't provide proof of ownership or capacity to hire — in form of logbooks and signed lease agreements," read the letter addressed to Mr Michael Short, the chief executive of GBM Engineering.
Interestingly, Mr Mugambi cited the same issues that had on four occasions been heard and determined by the PPARB.
SITE VISIT
According to an affidavit sworn by Mr Short, the NIB had on October 19, 2017 advertised in the local dailies inviting the seven pre-qualified bidders for a mandatory site visit on November 8.
"Mr David Kamotho, the firm's local representative, was the only party who attended the mandatory site visit with NIB staff members led by Engineer Loise," Mr Short says in his affidavit.
This prompted the NIB to disqualify the six companies from the tendering and begin the technical evaluation of the sole bid by GBM, with assurances that the British firm would be invited within a period of 21 to 30 days to discuss the financial component of the tender.
Mr Short states that, as required, GBM solely submitted their tender documents on November 30, 2017 and they were opened the same day at the Nile Basin boardroom of NIB's Unyunyizi House headquarters on Lenana Road, in Nairobi, in the presence of their representatives, Mr Kamotho and Mr Peter Mathews.
CANCELLED
Having been knocked out in the earlier stage, the other six firms never raised any objections, therefore legally making GBM the winner of the tendering process.
However, the NIB went silent for six months until May 29 last year, when they wrote to GBM, notifying the firm of its decision to cancel the tender, prompting the British firm to seek redress at the Public Procurement Review Board.
For its part, the NIB says that it cancelled the tender because the British company failed in the technical evaluation and had not submitted the bid security of 0.5 percent, payable by way of bank guarantee.
After hearing the dispute, the Procurement Review Board chaired by Mr Paul Gicheru nullified the NIB's decision to cancel the tender because under the design, fund, build and operate model, the contractor is supposed to finance the entire project.
TRIBUNAL
The matter was heard by Mr Gicheru and board members Peter Ondieki, Weche Okubo and Hussein Were, in the presence of lawyers Wilfred Nyamu for GBM and Lillian Kimani, Samuel Karanja and Dennis Aroka for the NIB.
The firm went back to the tribunal for the second and third time after the NIB alleged it did not show proof of ownership of machinery or capacity to hire equipment required for the works.
GBM Consortium protested that the NIB allegedly used false reasons to cancel their bid, yet they are globally renowned manufacturers of heavy equipment and that they had included the details of their machinery at their disposal in the tender documents.
The 21-day window ended on December 4 without NIB complying with the fresh orders, prompting the Sh250,000 fine on February 5.
In the latest appeal, the firm wants NIB punished for failing to comply with the orders and for contravening various tendering laws and be stopped from manipulating the process.

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