Selection of pre-qualified bidder for power transmission project: NTDC on a tightrope

ISLAMABAD: The Board of Directors (BoD) of National Transmission and Despatch Company (NTDC) is on a tightrope to select a pre-qualified bidder for a World Bank project of transmission line of Dasu hydropower project.

Construction of Dasu power evacuation transmission line at 765kV level comprises three lots. Lot -I and Lot-II are segments of the transmission line and Lot-III is grid station as well as transmission line at Mansehra. Pre-qualification for Lot -I and Lot-II has been done with the assistance of GOPA, international energy consulting firm.

Well informed sources told Business Recorder that M/s Sinohydro has been declared as the lowest responsive bidder against both lots and World Bank has accorded No Objection Letter (NOL); however NTDC Board is yet to consider the evaluation and approve it.

However, M/s Sinohydro does not meet the eligibility requirements, financial, as well as, experience, against either of the lots. And therefore, GOPA had declared M/s Sinohydro as non responsive in it’s initial evaluation report.

World Bank representative, Rikard, in one of the meetings during the pre-qualification process asked GOPA consultant to lump together experience and financials quoted by M/s Sinohydro against each of the lots. By doing so and ignoring variety of other deficiencies, GOPA consultant was made to declare M/s Sinohydro as lowest responsive bidder.

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According to official documents, Power Division conducted an inquiry on a complaint received by it during which the members of the Inquiry Committee (IC) and apprised the Additional Secretary, that M/s Sinohydro had submitted Pre-qualification (PQ) application for both lots, and submitted bid for only Lot-1.

The documents further reveal that GOPA bid evaluation report has several versions. In the first four versions, Sinohydro was declared as responsive. In a joint meting it was pointed out by NTDC/ World Bank would check the JV status and then in the 5th version of Bid Evaluation Report of February 16, 2021, GOPA declared Sinohydro as non-responsive.

In response to complaint (regarding submission of consolidated financial statement instead of standalone financial statement as required in PQ documents Mis-representation by bidder), NTDC team informed that GOPA in PQ Evaluation Report and response to the complaint says that the financial statements are stand alone. Later on GOPA in its on March 17, 2022 admits that financial statements submitted by the Sinohydro are consolidated financial statements whereas ITA Clause 25.5 of PQ Documents requires the bidder to submit standalone financial statements. The Inquiry Committee observed that as far as financial statements submitted by Sinohydro for PQ are concerned, these are claimed to be stand alone and hence GOPA has not rejected them. However, the statements submitted by Sinohydro with its bid are termed by auditor as Consolidated Financial Statements. Hence GOPA should have rejected the bid but unfortunately it has not done so.

On complainant’s observation regarding lack of required experience by M/s Sinohydro of Design, Supply, Installation and Testing & Commissioning for a 380 kV or higher voltage level transmission line, NTDC team responded that the bidder’s qualification has been based on the following two projects: (i) 400kV Soya-Kapary T/Line and ;(ii) 400 kV Karuma-Kawanda T/Line in Uganda and Karuma- Olwiyo T/Line.

The Inquiry Committee stated that the project “400kV Soya-Kapary T/Line” was executed by the bidder, i.e., Sinohydro in JV with M/s TBEA. The role of the bidder was only for civil works etc. so the project was not carried out on EPC basis by the bidder. On similar grounds, M/s ZVS participating in JV with M/s Engro have been declared non-responsive in the bid evaluation report.

Further the share of the bidder’s price is not exactly known as $135 million share has been considered based on 33% share claimed by the bidder without clear BOQ vis-à-vis responsibility of the bidder. There is also difference in completion dates mentioned in certificate of acceptance and end user certificates.

The project/ Transmission Line “400kV Karuma-Kawanda” was not completed within 4.5 years. The contract was awarded in August 2013 with start date as 16th December 2013. As per Bidding Documents, the project should have been completed in 4.5 years. The said project has three components, detailed scope of work given needs clarification which must have sought by GOPA; however, assuming that all works fulfil the requirement the total cost turns out to be $ 168 million. Requirement of $180 million is not met.

The Additional Secretary raised serious concerns on the issues in such a mega project of national importance, which also raises doubts on the capability of the Consultant.

After detailed discussion the Inquiry Committee decided to send a letter to Chairman NTDC Board requesting him to investigate the matter.

The sources said, NTDC BoD is expected to request WB to withdraw its NOL granted in favour of M/s Sinohydro to make the process transparent.

Copyright Business Recorder, 2022