Deep Water Container Port project: KPT Board expresses reservations about competence of bidder

The reconstituted Board of Karachi Port Trust (KPT) has postponed the approval of awarding the Rs 19.288 billion capital dredging contract to, what sources said, a 'deficient' Chinese firm.
According to official sources in KPT, the Board, at its Wednesday's meeting, decided to delay the award of a very important contract to M/s China International Water & Electric (CWE), which, according to the sources, lacks in experience, equipment and personnel, until further discussion on the matter.
They said the Board was deliberating upon "some queries" regarding different aspects of CWE's offers, particularly the proposed rates (average) that stand at Rs 310 per cubic meter for dredging and Rs 187.50 and Rs 447 per cubic meter for the disposal of 24 million and reclamation of 8 million cubic meter dredged material, respectively.
The rates offered by M/s China Harbour Engineering Company (CHEC), the only competitor of CWE in bidding process, stand, however, far greater at Rs 660, Rs 281.50 and Rs 444.70 for the same three jobs, said the sources.
The KPT sources said CWE had offered the rates almost nearer to that of "engineer estimates" of Karachi Port's operator. They said the Board was likely to meet again on September 24 for final decision. It may be mentioned here that CWE had offered the lowest bid of Rs 19. 288 billion against CHEC's Rs 33.229 billion.
According to sources M/s Royal Hoskonigs of UK, KPT's consultant for the $1.6 billion Pakistan Deep Water Container Port (PDWCP) project that is to be undertaken in three different phases of Dredging and Reclamation Work, Marine Protection Works and Construction of Quay Wall, has already expressed its concerns over the ability of CWE to undertake the big project.
They said after evaluating technical bids of the two companies Hoskonigs had observed that CWE was lacking in experience, equipment and personnel, which are the three important areas for undertaking the dredging and reclamation project.
The sources said according to the consultant CWE had no international exposure in rock dredging in the open sea and it was required to hire personnel with proper experience in undertaking international dredging contracts along with a high capacity CSD and Backhoe dredger for rock dredging.
They said that the consultant had also rejected the proposed plan of CWE as "inadequate" saying that it might not ensure a timely dredging of the hard soil. Despite all such shortcomings, the sources said, Hoskonigs had recommended that KPT could consider award of work to CWE on the condition that the bidder needed to improve in the categories of experience, personnel and equipment.
Earlier, the sources said the Department Tender Committee (DTC) had also disappointedly advised KPT that either discharge the tender or award it to the lowest bidder, as no improvement was in sight if the tender was re-invited. DTC had also asked KPT that before awarding the contract it should get assurance from the Chinese firm that it would be responsible for employing any personnel or equipment if a need arises sometime during the work on the project.
Surprisingly enough, the committee had also recommended award of the contract to CWE on the condition that it would ensure uninterrupted supply of compatible equipment and manpower and review the 50 percent foreign currency component which stands at Rs 9.282 billion at the rate of Rs 60.90 per US dollar. A KPT official, however, told Business Recorder on Thursday that the project consultant had approved CWE for the award of contract without any reservations.