OCG commends OUR for handling of 360MW project

The Office of the Contractor General (OCG) yesterday commended the Office of Utilities Regulation (OUR) for its handling of the 360-megawatt project.

In a release to the media, the OCG said the direction now being pursued by OUR Director General Albert Gordon to request and await documents critical to the progress of the project from preferred bidder Energy World International (EWI) was commendable.

The release said that in January, the OCG sent a letter to the OUR in reference to the instructions for final proposals done in May last year. In those instructions, it was a requirement that all bidders submit " … audited financial statements for the past three years, supported by the parent entity's or equity partner's audited financial statements … ".

The OCG said EWI was yet to fulfil that requirement.

SERIOUS IMPLICATIONS

"In the foregoing regard, the OCG cautions that this apparent delay on the part of EWI has serious implications for the due-diligence process currently being undertaken by the OUR and, by extension, the timely and successful execution of the project. Further, the long-term fiscal implications cannot be ignored, as the OUR acts, not on its own behalf but on that of the people of Jamaica, who will ultimately bear all expenses related to this critical and necessary undertaking," the release stated.

"It is on this premise that the OCG commends the OUR and supports the stance taken, in not providing a recommendation to the minister of science, technology, energy and mining, for the issuance of a licence to supply electricity-generating capacity to the Jamaica Public Service (JPS), until the EWI has fulfilled its obligations in providing the relevant documentation required as a part of the due-diligence exercise."

BOND PAID

Last October, EWI secured its selection as the preferred bidder to construct Jamaica's much needed 360-megawatt power plant, when it paid over the required US$7.37 million bond, representing one per cent of the total cost of the baseload generating capacity project, which is valued at US$737 million.

The inclusion of the Hong Kong-based company among the list of four bidders had been clouded in controversy, with Contractor General Dirk Harrison asking that it be excluded from the list because its bid was facilitated after the cut-off date of March 15, 2013.

However, the OUR hit back, saying that based on the informal nature of the process, it could lawfully accept and consider EWI's bid.

EWI now has to meet the other requirements under the agreement in order for the successful completion of the process.