Home' Trinidad and Tobago Guardian : November 28th 2015 Contents Minimum wage still to be reviewed --- McLeod News --- Page A6
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The National Gas Company (NGC) is
moving to recover from Super Industrial
Services Ltd (SIS) the costs of completing
the works on the Beetham Wastewater Proj-
ect and any other losses and damages
incurred as a result of SIS s alleged breaches
of a billion-dollar contract for the project,
Minister in the Ministry of the Attorney
General Stuart Young says.
In a statement to Parliament yesterday,
Young revealed that NGC, whose mandate
was not the provision of water, entered into
the contract for over $1 billion and had paid
out over $780 million to SIS to date---about
75 per cent of the full cost---when only
approximately 40-45 per cent of the project
work was completed.
With the impending termination of the
SIS contract effective December 4, Young,
relating details of what had led to this, added:
"An assessment is being conducted by the
new NGC board to decide what are the next
steps to be taken with respect to this project
that has cost over $780 million. Options
include commencement of arbitration pro-
ceedings to recover damages incurred and
the costs associated with the completion of
the project. When a decision is taken with
respect to the future progress of this project
we ll inform the public."
The NGC, under the past People s Part-
nership (PP) administration s tenure, had
awarded a contract to SIS for the design and
build of the plant, together with the associated
pipelines and water storage facilities. The
purpose of the project was to recycle output
water from WASA s existing wastewater treat-
ment plant to industrial water quality standard
and to take the pipe-treated water from
Beetham to the Pt Lisas Industrial Estate
using newly built pipeline infrastructure.
Young said requests for proposals for the
project were issued on December 10, 2013.
The contract was issued on March 10, 2014,
in the sum of approximately
He said, "It s noteworthy that SIS wasn t
the lowest bidder on this project. In fact,
SIS s bid was TT$464,196,390
(USD$72,530,686) more than the other bid-
"It s also noteworthy, the last administration
paid a 20 per cent mobilisation to SIS. It is
not usual to have as high as a 20 per cent
mobilisation fee. In this case, NGC made an
advance payment to SIS which was
"A mobilisation fee is usually worked back
through the life of a contract, with appropriate
credit or repayment being given to the
employer as the contract is performed. To
date, none of this mobilisation/advance pay-
ment, of some TT$207,430,810.00, has been
repaid (or credited) to NGC by SIS."
Further, Young said, to date NGC has paid
SIS the sum of approximately $780 million
(USD$121,745,121.64), with the last payment
certificate certified by NGC being for work
done in May 2015.
He said on October 8, 2014, SIS was award-
ed a further contract by NGC for operation
and management of the Beetham Water Recy-
cling Plant for a five-year period with a value
of approximately $56.4 million.
"This contract was only for the Beetham
plant and not the pipeline to Pt Lisas nor the
storage at Pt Lisas. The question is why was
NGC utilised as the entity to contract SIS
for the design/build of this billion-dollar
water provision facility as opposed to WASA?
WASA is the statutory body charged with
the responsibility for water supply," he said.
"It has also been discovered that to date,
there is no off take contract entered into
for the final water product from this project.
Therefore, NGC, whose mandate was not
and is not the provision of water, entered
into this contract for over TT$1 billion, paying
out over TT$780 million to SIS to date, and
only approximately 40-45 per cent of the
project work is completed, when over 75 per
cent of the full cost of the project has already
been expended from the cash coffers of NGC."
Young said the new NGC board was having
an independent assessment done of the works
performed to ascertain the quantum and per-
centage of work actually performed, since
this was necessary due to the circumstances.
He said SIS began slowing down works prior
to the general election and this became even
more apparent after the September 7 general
"After elections, NGC received several
reports from the sub-contractors of SIS as
to non-payment of monies due to them by
SIS. On September 14, 2015 (one week after
the elections), SIS wrote to NGC in an attempt
to extricate itself from its contractual obli-
gations, after having already been paid $780
million and only completing 40-45 per cent
of the works."
(With reporting by Renuka Singh)
SIS collects $780m for 40 per cent of work
NGC seeks to recover excess
Minister in the Ministry of the
Attorney General, Stuart Young, also
said yesterday that SIS, in
discussions about the controversial
project, claimed, "...people now
holding high office in the
Government...have made serious
allegations about the project and the
conduct of officials of NGC and SIS."
As a result, he said SIS stated it
was "...reasonably certain that steps
would now be taken by the State to
stop or frustrate SIS in the
successful execution of this project."
Young added, "SIS used this as
one of its reasons for slowing down
works and eventually refusing to
continue the project. (But) There
was no evidence to support this
position that the new Government
would have stopped or frustrated
SIS from completing the project."
He said NGC denied any
allegations of state interference and
stated it was committed to
enforcement of the contract and it
expected SIS to continue to deliver
all contractual obligations in a
responsible and timely manner.
Young added, "There then ensued
an exchange of correspondence and
communications between SIS and
NGC, wherein SIS claimed that it
had underbid on the project at the
tender stage and it was unable to
continue the works without a review
of the contract price and project
schedule and that it could no longer
fund the works. This, even though
SIS's price for the project was
TT$464 million more than the next
"SIS also suddenly claimed it had
safety and security threats and it
used this as its excuse to begin the
withdrawal of construction
resources, manpower and
equipment from the sites on
October 8, 2015," he said.
"Despite the exchanges and
discussions between the parties, SIS
refused to renew the performance
payment bond and the insurance
coverage that it was contractually
obligated to renew; this left NGC
exposed. Ultimately, SIS indicated it
would only complete the project on
new terms and conditions, including
a new project schedule, all whilst it
withdrew from the project sites.
"As a result of these
developments, NGC, under direction
of its new board sought and
obtained independent legal advice
and moved quickly to protect NGC's
position (and the position of the
citizens) with some $780 million
having already been expended.
"On Friday, 20 November, after
due and proper consideration of the
facts, failed attempts to discuss the
way forward and the advice
obtained, NGC gave SIS written
notice of its intention to terminate
the design/build contract."
He said, NGC, in recapping SIS's
position that it was unable to
continue with the works, drew
attention to actions by SIS that
"demonstrated that SIS had
abandoned the works or
alternatively did not intend to
continue performance of its
obligations under the contract."
The company was founded by
businessman Krishna Lalla, who
divested the majority of his holdings
to sons Terrence and Lincoln Lalla.
Early last year both sons were listed
as the owners of the company and
media reports listed Terrence as the
main owner of the company
But in a brief telephone interview
yesterday, Terrence Lalla distanced
himself from SIS.
"I am no longer involved with SIS's
business," Lalla said.
"I no longer have anything to do
with SIS and cannot even direct you
who to talk to there," Lalla added.
SIS CLAIMS GOVT INTERFERENCE
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