Geothermal boss get 5 days over tender
What you need to know:
- But Dr Simiyu asserted that the French Development Agency, the project’s financier, was aware of the matter and had given their assent. The allocation, which was made via the government, was $70 million (Sh6 billion).
The management of the Geothermal Development Company has five days to provide MPs with explanations about its award of an extra tender to a Chinese firm.
Dr Silas Simiyu, the parastatal’s chief executive officer, was ordered to prepare a proper report on the procurement of three rigs after the Public Investments Committee detected inconsistencies in his presentation last Tuesday.
The committee will question the company’s relationship with Sichuan Honghua Petroleum Equipment Company Limited, which initially won a contract to supply two drilling rigs at $43 million but was then awarded a third contract in questionable circumstances.
China Petroleum Technology and Development Corporation, which was initially reported to be the company involved, has since clarified that it wasn’t. Sunday Nation has learnt that it was indeed Sichuan Honghua who were working with GDC.
PIC members are concerned that the third drilling rig, acquired at a cost of $21 million early 2013 was not subjected to competitive bidding, meaning they can’t tell whether it would have cost less.
But Dr Simiyu asserted that the French Development Agency, the project’s financier, was aware of the matter and had given their assent. The allocation, which was made via the government, was $70 million (Sh6 billion).
“The issue was should we go back to doing a new tender or should we add to this contract, because we had not signed the contract for the two rigs, or should we go ahead and instead of awarding two rigs, award three rigs? That’s when the bank gave us an okay,” said Dr Simiyu.
Competitive bidding
But MPs differed, saying that because this was a new contract, it ought to have been subjected to competitive bidding as this created the chance a lower price would be offered.
Chris Wamalwa (Kiminini, Ford-Kenya) was alone in suggesting that because of the circumstances, the law allowed GDC to offer the Chinese firm a supplementary Local Purchase Order.
Committee vice chairman Kimani Ichung’wa, however, said that would be determined when the committee holds its in-house meeting to come up with a decision.
The procurement is also reported to have attracted the attention of the Ethics and Anti-Corruption Commission, which wants to review it and know why the GDC board was not consulted.
Although Dr Simiyu had an explanation ready, he appeared to contradict himself after questioning, first saying that the award of the contract for the three rigs was done at the same time when they realised they have a surplus but later stating that the thrid one was done after the first two.
He insisted that they had documents showing the bank had allowed them to spend the money that way but then admitted that his initial assertion was misleading.
Mr Keynan asked him to meet the committee when he was better prepared with answers. “The way I see it, there are issues that are not consistent with the questions that we have asked.
The best thing is for the CEO to go back, get the chronology of events with all the necessary annexures and then come back and meet us because either you are not ready or have decided wilfully to come and incriminate yourself,” said Mr Keynan.
