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FM
Former Member
$3.7B sea Defence Contracts…EU may Withhold $$billion in Funding
DECEMBER 17, 2011 | BY KNEWS | FILED UNDER NEWS
…as BK Int’l fails on many projects

The European Union (EU), Guyana’s largest donor for critical sea defence works, says that it could cancel remaining funding for the current sea defence projects. It is blaming the non-execution of some projects and the slow pace of others for which money has already been released. It is calling for a speeding up of some $3.7B worth of projects which it says are way behind schedule. At fault is contractor B.K. International.

Making it clear that the government may now have to move to seek liquidated damages from the contractor, B.K. International for the incomplete works, EU warned that Guyana faces the very real possibilities of seeing the remainder of funds not being released. Kaieteur News was told that once the deadline for a project has passed and it has not been completed, no further disbursements can be released from the EU.

The EU believed that the delays were caused mainly by a certain lack of capacity in managing the large portfolio of the contract and to some extent inadequate provision of resources for the completion of the jobs which stretch from Essequibo to Springlands, Berbice.

With Guyana’s heavily populated coastlands below sea level, sea defence works have taken heightened significance for the government especially with claims of rising sea levels. In addition to the thousands of homes along the coastal belt, the majority of sugar, rice and other farmlands are located there which could all be threatened should there be breaches in the system.

BK warned
Yesterday, Minister of Public Works, Robeson Benn, commenting on the EU statement, said that the matter has been engaging the attention of his Ministry for a while. “There has been a constant review of the projects and if there are options where we could recover monies through liquidated damages, we will pursue them. There have been several notifications to BK over the outstanding works and efficiency.”

He insisted that BK has been made to pay damages for late contracts in the past and this time would be no different if the company falls short. Kaieteur News understands that the contracts were signed over two years ago and were to the tune of €13.6 ($3.7B).
According to the EU statement yesterday, the body has a long history of involvement in the reconstruction and repair work of the sea defences in Guyana.

So far, the EU has contributed $22B (€80M) in grants towards the sector since the mid 70’s, making it by far the largest provider of support to the Government of Guyana in this field.

In addition, the release pointed out, the EU is funding the ongoing Mangrove Programme through the Global Climate Change Alliance at a value of $1.12B (€4.1M), which aims at securing the natural protection from the sea and establishing new mangrove reserves. EU further disclosed that its recent activities include new construction of 1.6 km of sea defence in the areas of Clonbrook, East Coast Demerara, and Springlands, East Berbice; the rehabilitation, upgrading and maintenance of 18 km of sea defence in 31 different locations; provision of supervision services; procurement of supplies and technical assistance for the Works Services Group at the Ministry of Public Works.

On Tuesday and Wednesday, EU and the representatives of BK International and the government carried out inspections on several locations for “provisional acceptance”. The places inspected included Kitty, Coldingen, Melanie Damishana, Clonbrook on the East Coast of Demerara and Springlands, in East Berbice. Inspections were also carried out at Uitvlugt, West Coast Demerara and Orangestein, Aurora, Onderneeming, Lima, Walton Court, Johanna Cecelia and Zeelandia, in Essequibo. The EU statement did not immediately identify the incomplete projects.

Liquidated damages
“While the works at most locations were in an acceptable state allowing for provisional acceptance, at some locations the works could not be taken over, which could result in enforcement of liquidated damages,” the release said.

The EU Ambassador, Robert Kopecký, was said to be encouraging the contractor, BK International, to accelerate the works.
Delays over the last two years, the EU felt, were caused mainly by a “certain lack of capacity in managing the large portfolio of the contract and to some extent inadequate provision of resources.”

“Based on the above mentioned, the Delegation of the European Union in Georgetown encourages its Guyanese partners in the ongoing sea defence projects, both from public and private sectors, to do the utmost to ensure an immediate acceleration of the works, otherwise there is a risk of loss of considerable amounts of funds which would not be in the spirit of the so far very good and friendly cooperation.”

Kaieteur News understands that BK International has applied for a work extension until February but an official close to the projects said that it is unlikely even for that deadline to be met.

The $3.7B projects included two components- new construction which includes rip-rap works and repairs to old concrete and other critical areas.

Should BK International fail to meet the new deadlines, it could see Government being forced to pay for the remainder projects out of the government coffers while at the same time pursue BK International for damages.

Replies sorted oldest to newest

BK won contracts based on a bidding process approved by the EU. Their advantage in getting these contracts have little to do with their political affiliation rather them being the largest construction firm in Guyana with the capability of undertaking the projects. They got greedy and took on more than they can chew. But this also can be blamed on those approving the bids as they should have taken BK's lack of capacity into consideration.
FM
quote:
Originally posted by BGurd_See:
BK won contracts based on a bidding process approved by the EU. Their advantage in getting these contracts have little to do with their political affiliation rather them being the largest construction firm in Guyana with the capability of undertaking the projects. They got greedy and took on more than they can chew. But this also can be blamed on those approving the bids as they should have taken BK's lack of capacity into consideration.
They are the largest construction company because of patronage. That they do no complete their jobs and proiduce shoddy work has a long legacy.

The government need to hire engineers with TQM expertize, break down contracts to smaller pieces rewrite contract provisions, then farm them out to multiple sources so as to build capacity and not have our nation dependent on this incompetent and arrogant firm
FM
quote:
Originally posted by D2:
They are the largest construction company because of patronage. That they do no complete their jobs and proiduce shoddy work has a long legacy.

The government need to hire engineers with TQM expertize, break down contracts to smaller pieces rewrite contract provisions, then farm them out to multiple sources so as to build capacity and not have our nation dependent on this incompetent and arrogant firm


What patronage? Tiwari had the capital to buy heavy equipment and put his firm in a position to qualify for contracts. Every entity that does business with the govt according to you is due to connections despite a transparent contract awarding process. Name the other firms that were more qualified than BK that were denied contracts?
Apparently you know very little of construction, most tasks can not be broken down, and in fact too many cooks spoil the broth. One firm working on a project from start to end is the best scenario since the experience, continuity and knowledge will be leveraged throughout the timeline. What govt needs to do is invite foreign bids, this will solve the problem.
FM
quote:
Originally posted by BGurd_See:
quote:
Originally posted by D2:
They are the largest construction company because of patronage. That they do no complete their jobs and proiduce shoddy work has a long legacy.

The government need to hire engineers with TQM expertize, break down contracts to smaller pieces rewrite contract provisions, then farm them out to multiple sources so as to build capacity and not have our nation dependent on this incompetent and arrogant firm


What patronage? Tiwari had the capital to buy heavy equipment and put his firm in a position to qualify for contracts. Every entity that does business with the govt according to you is due to connections despite a transparent contract awarding process. Name the other firms that were more qualified than BK that were denied contracts?
Apparently you know very little of construction, most tasks can not be broken down, and in fact too many cooks spoil the broth. One firm working on a project from start to end is the best scenario since the experience, continuity and knowledge will be leveraged throughout the timeline. What govt needs to do is invite foreign bids, this will solve the problem.
Unquestionably patronage. Every task can be broken down. It is fundamental to engineering.
FM
quote:
Originally posted by BGurd_See:
BK won contracts based on a bidding process approved by the EU. Their advantage in getting these contracts have little to do with their political affiliation rather them being the largest construction firm in Guyana with the capability of undertaking the projects. They got greedy and took on more than they can chew. But this also can be blamed on those approving the bids as they should have taken BK's lack of capacity into consideration.
dummy it all had to do with politics,friends and family,now guyana is the loser.i hope ppp supporter like you is happy
FM
The MO of the cabal is to bamboozle the public with "PROCESS" [God Bless the Burnham Constitution] to legalize (sanitize) their not so indirect, criminal transfers of the public wealth from the People to their cronies.

How do you think BK Int'l became a 'National Champion'??!

Ask minister Benn . . . you'd be surprised
FM
quote:
Originally posted by D2:
Unquestionably patronage. Every task can be broken down. It is fundamental to engineering.


Nonsense, continuity is more important, the same people stating the task and finishing it and applying the knowledge for previous task to complete subsequent tasks. You are a know it all in theory, but when it comes to practical application you lack of experience shows.
FM
quote:
Originally posted by warrior:
quote:
Originally posted by BGurd_See:
BK won contracts based on a bidding process approved by the EU. Their advantage in getting these contracts have little to do with their political affiliation rather them being the largest construction firm in Guyana with the capability of undertaking the projects. They got greedy and took on more than they can chew. But this also can be blamed on those approving the bids as they should have taken BK's lack of capacity into consideration.
dummy it all had to do with politics,friends and family,now guyana is the loser.i hope ppp supporter like you is happy


To some extent maybe, however without a certain level of competency they would not have survived so long and have so many successful finished projects under their belt. Dunces like yourself can not fathom this simple fact.
FM
quote:
Originally posted by BGurd_See:
quote:
Originally posted by D2:
Unquestionably patronage. Every task can be broken down. It is fundamental to engineering.


Nonsense, continuity is more important, the same people stating the task and finishing it and applying the knowledge for previous task to complete subsequent tasks. You are a know it all in theory, but when it comes to practical application you lack of experience shows.
What shows is you are your usual ignorant self. The strategy of systemically breaking down things into their component parts is fundamental to building process. In the US cars are made from dozens of components each made by an individual company. Even sophisticated machines as the space shuttle had no one builder but hundreds of builders each supplying their particular component based on their specialty.
FM
quote:
Originally posted by D2: What shows is you are your usual ignorant self. The strategy of systemically breaking down things into their component parts is fundamental to building process. In the US cars are made from dozens of components each made by an individual company. Even sophisticated machines as the space shuttle had no one builder but hundreds of builders each supplying their particular component based on their specialty.


This may apply to cookie cutter project like cars, however in projects that are highly specialized as in building custom made kokers, stellings and so forth, this your approach does not work.
FM
quote:
Originally posted by BGurd_See:
quote:
Originally posted by D2: What shows is you are your usual ignorant self. The strategy of systemically breaking down things into their component parts is fundamental to building process. In the US cars are made from dozens of components each made by an individual company. Even sophisticated machines as the space shuttle had no one builder but hundreds of builders each supplying their particular component based on their specialty.


This may apply to cookie cutter project like cars, however in projects that are highly specialized as in building custom made kokers, stellings and so forth, this your approach does not work.
Let me reiterate, BK does not build sophisticated machines. It fabricates dams, piers and roadways as you said and nt grand designs. Its projects are even more clearly reducible to it component parts and each divided up to competing parties. It makes for greater efficiency in all aspects from of the build and there is no dependency on one individual for its success. Further, blame can clearly be isolated when components fail.

In any event, this company is slopy, always over budget and has a history of defective products. It is the reason the EU is threatening to withhold funding and requesting that some avenue for compensation for shoddy work be explored with respect to this company.
FM

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