A Chinese company that was denied a multimillion-shilling contract for the Thwake dam project has appealed the decision to award the tender to the second-lowest bidder.
China Gezhouba Construction Group Corporation (CGCGC), which put in the lowest bid (Sh36.9 billion) for the Sh62.3 billion project, moved to the Public Procurement Administrative Review Board (PPARB) on Thursday to challenge the decision by Irrigation Principal Secretary Patrick Nduati Mwangi.
Mr Mwangi awarded the contract to the second-lowest bidder – STECOL Corporation (Sino Hydro Tianjin Engineering Co Ltd) – which quoted Sh39.5 billion.
“You are hereby notified that on March 30, 2017, a request was filed with the PPARB… under section 168 of the Public Procurement and Asset, Disposal Act 2015, no contract shall be signed between the procuring entity and the tenderer awarded the contract unless the appeal has been finalised,” the board said in a notice to Mr Mwangi and copied to Gezhouba.
The notice comes a day after the project financier, the African Development Bank (AfDB), refused to approve the award to Sino Hydro.
Mr Mwangi had on Monday disregarded the AfDB, the Attorney-General, the Ethics and Anti-Corruption Commission and Cabinet Secretary Eugene Wamalwa’s advice to award the contract to the lowest evaluated bidder, CGCGC.
The AfDB rejected Mr Mwangi’s request to have the contract awarded to Sino Hydro.
“Based on the information provided, the bank regrets to inform you that no objection to award the tender to the second lowest bidder cannot be given since there is no justifiable reasons to reject the least evaluated bidder,” AfDB director-general for East Africa Gabriel Negatu said in the letter copied to Head of Public Service Joseph Kinyua, Mr Wamalwa and Treasury Cabinet Secretary Henry Rotich.
Mr Mwangi had sought the bank’s nod to award the contract to Sino Hydro, which, if granted, would have seen taxpayers lose more than Sh3 billion in the first phase of the project.
He later awarded the contract to Sino Hydro, subject to the lowering of the bid price to Sh36.9 billion, approval from the Attorney General and availability of funds from the Treasury.
The the lender’s dismissal of the no-objection request means the bank does not support the award of the contract to Sino Hydro.
The water project, to be located on the border of Kitui and Makueni counties, is being financed jointly by the government and the AfDB. The latter will foot 35 per cent of the cost.
Mr Negatu said AfDB’s procurement rules and procedures prohibit modification of bids including negotiation of price for works.
Mr Wamalwa had on March 23 appeared before the National Assembly’s Agriculture Committee to provide the way forward given that the AfDB has refused to clear the award of the tender to STECOL Corporation.
He said then that Mr Mwangi had cited pending clearance from the EACC and the parliamentary committee as the impediments to the award of the contract to CGCGC.
The MPs say the two must explain to Kenyans the next cause of action following the new developments that put the project in limbo.
The multipurpose Thwake dam project is slated to create a vast reservoir and catchment area of 10,276 square kilometres once completed, making it one of its kind in East and Central Africa.
Nicholas Muthui, chief executive officer of the Tanathi Water Services Board, who oversaw the technical designing of the project, said the Thwake dam dwarfs Seven Forks in size and output.
The Seven Forks dams are on the lower part of Tana River.
The dam is a Vision 2030 flagship project and is expected to supply piped water to residents, power the Konza techno city and adjacent towns as well as generate 23 megawatts of hydropower.
“The project is planned for implementation in four main phases including construction of a 77 meter high dam, hydro power generation component, 34600 cubic meters of water supply and a final phase of irrigating 40,000 hectares in the two counties,” he told the Nation in a recent interview.
Mr Muthui said the government has set aside Sh2.4 billion for compensating hundreds of families living around the confluence of the Thwake and Athi rivers to pave the way for its construction.
The National Land Commission is currently compensating 519 households at the rate of Sh180,000 for every acre of land taken.