Sri Lanka Access Engineering explains runway deal
COLOMBO (EconomyNext) – Sri Lanka’s Access Engineering has explained that a runway repair contract cancelled by the new government was awarded to it by the former regime after local contractors were encouraged to bid to acquire expertise despite not having experience.
The company said in a stock exchange filing that five local contractors invited to bid for the deal had explained they do not have the required experience and would not meet the required pre-qualification to carry out the work.
"The local contractors were informed that they could collaborate with foreign contractors to meet with the relevant pre-qualification and experience criteria and was invited to submit their proposals,” it said.
The government this week said it had cancelled the 85.77 million US dollar contract to repair the runway at the international airport at Katunayake the former Rajapaksa regime awarded to Access Enginering.
This was because no competitive tender procedure had been followed in the award of the contract and Access Engineering lacked experience for the runway work, Ports and Aviation Minister Ranatunga told the Cabinet of ministers.
The Access statement said two bids were received from two international contractors, Lagan Construction Ltd. of Northern Ireland and China Harbour Engineering Company Ltd. of China in May 2013.
Five local contractors were called to attended a meeting called by the Secretary, Ministry of Finance on 11th and 13th December 2013: Nawaloka Construction Company, Maga Engineering (Pvt) Ltd., Tudawe Brothers Ltd., Sierra Construction (Pvt) Ltd., Access Engineering.
“The contractors present were informed that the government has decided to use local bank finance to carry out work with respect to the project and the tender called in January 2013 for carrying of the project where finance was from overseas, would not be pursued.”
The local contractors were told that if they were unable to form a suitable consortium and submit a proposal, the government would be compelled to proceed with the international contractor selected through the tender.
AEL said it submitted its preliminary proposal on 28 January 2014 together with the Louise Berger Group of USA, Katahira & Engineers International and World Kaihatzu Kogyo Company of Japan.
Thereafter, having ascertained the exact scope of work and parameters of the project, and site visits, in consultation with Airport and Aviation Services of Sri Lanka, AEL submitted its detailed proposal incorporating the changes and new requirements of AASL on 24th April 2014.
After further discussions with the Cabinet Appointed Negotiation Committee and the Procurement Committee, AEL submitted the final revised proposal on 18th August 2014,
After further negotiations, ending on 31st October 2014, AEL said it agreed to the contract at US$ 85.77 million and AASL awarded the contract to AEL on 10th December 2014.