Dear Editor,
BK International Inc wishes to refer to the press release of the Delegation of the European Union on the 9th EDF Sea Defence Programme Contract which was carried prominently in all the major media. We want to emphasize that the official date of completion of this project is February 28, 2012 and we intend to complete this project by that date.
We have already taken the necessary steps to ensure the timely completion of the works and we are confident of our ability to perform these tasks. We are pleased at the inspection carried out by the Delegation and are happy at their report that at “most” locations the works were in an “acceptable” state allowing for provisional acceptance of the 13 locations inspected. Some helpful observations were made during the inspections and BK International Inc is grateful for their comments which we accept in the spirit of cooperation between BK International Inc and the European Union.
However, we need to remind the general public that this contract is governed by Article 31, ‘Tax and Custom Arrangements‘ item 1:2.0 2(g) and 3, which provides for the contractor to be granted duty free concession for the supply of equipment and plant, and the waiver of all local taxes and duties for materials used. BK International suffered considerable delay in obtaining these duty free concessions (approximately six months) and this contributed to a delay in the commencement of the project.
Incidentally, after two years, we are still awaiting the exemption of royalty for sand under this project which was agreed to by all parties under the addendum to the contract. The EU is aware of this.
In addressing the statement about the lack of capacity in managing the large portfolio, BK International Inc wishes to state that the company has executed in excess of thirty sea defence projects of a similar nature funded by international financial institutions and the Government of Guyana over the past twenty two years.
Most recently (9th EDF Sea Defences) BK International, with a price of $4 billion, successfully competed against MNO Vervat, International BV, a European construction company whose bid was $12 billion. For this particular project, BK’s bid was therefore $8 billion less than the other bidder. In addition, the Government of Guyana and the European Union requested and negotiated a further reduction of over €300,000 in BK’s successful bid and BK agreed to this as requested in the spirit of patriotism. This means considerable savings for the Guyana economy.
BK International Inc maintains that it has the capacity to handle all of the contracts entered into and this includes management and engineering capacity, financial and equipment resources, and that it has completed sea defence works in all the coastal regions of Guyana.
BK International Inc possesses the largest fleet of equipment, land and sea transport, and the most technical personnel of all local contractors. Our quarry is the largest in the Caribbean and satisfies all our sea defence needs. Our fleet of tugs and barges is capable of moving all material for the sea defence works under the 9th EDF Sea Defence project in a timely manner. BK International Inc is also a fully integrated construction company.
It should be noted that BK International Inc has never failed in the delivery of the final product as per contracted designs, which cannot be said of some international firms contracted in the past. For example, the Firm Pac-Gelfi Construction Company which is a large construction company from Italy that did sea defence works during the 7th EDF in Guyana had failures in two regions, at Richmond in Region 2 and Greenwich Park in Region 3. There were slippages in excess of 150 metres of sea defences into the ocean. These works were rectified at considerable expense by the Government of Guyana, the details of which are at the Ministry of Finance, and the EU is aware of this.
It should also be noted that prices per metre paid by the EU for works done from the 7th EDF to now, have dropped by 50%, while the costs for fuel, materials and equipment have risen by approximately 45%. However, BK International Inc has maintained a standard price.
In spite of the constraints in obtaining duty free waivers and customs clearance, at the commencement we shall deliver this project on time and to the highest standard as is our norm when we undertake works of this nature. We appreciate how critical the protection of the coastland is, in relation to the ingress of the sea and its effects on agriculture and the well-being of the populace,
The coming months will demonstrate our commitment, capacity and resolve to successfully complete the project. We do not believe that there will be the need to enforce any penalties in our contract for these works and we feel confident that the cooperation which exists between the European Union and Guyana with regard to funding for critical projects in this country will not be affected in any way.
Yours faithfully
Brian Tiwarie
Managing Director
