The Synergy Holdings-contracted access road for the Amaila Falls Hydroelectric Project is nearing completion even as the larger project is further delayed from starting up because of setbacks in financing.
A source close to the Ministry of Works said that the Amaila road project, wrested from the hands of Makeshwar ‘Fip’ Motilall of Synergy Holdings, may be completed by the end of the year and that a number of contractors are working to meet this deadline, although rainy weather posing a challenge.
“We have to finish by the end of the year, but we are aiming for October 31,” the source disclosed. The sources said that it is difficult to place laterite in the rainy weather.
The source said too that rain in the interior was hampering the speed at which the works can be executed. The source noted too that the new works also include the building of a bridge across the Kuribrong River.
The source said that section two of the road is being done by the Ministry of Public Works while sections three and four are being completed by Toolsie Persaud Quarries. Ivor Allen is working on section five of the road, G. Bovell on section six and HN Pasha on section seven, the source disclosed yesterday.
Government and Motilall came in for severe criticism with the award of the contract in the early months of 2010 as persons questioned the wisdom of the award on the basis of doubt of Motilall’s road-building experience. Government defended the process as being open and transparent and said that out of the five or so bids received, Motilall’s bid was the most favourable.
In January 2012, the Government of Guyana announced that it had terminated the US$15.4 million contract that had been awarded to Motilall for his failure to meet deadlines. Prime Minister Sam Hinds in a recent televised debate on NCN 11 stressed that Motilall only was paid for work that he had completed.
In March 2012, Cabinet Secretary Dr. Roger Luncheon announced that the contract for section three of the road is valued $373.2M; section four, $246.003M; section five, $182.35M; and section six, $281.72M.
When Stabroek News asked Minister of Finance Dr. Ashni Singh for an update on the larger hydro project, he said that things were “moving ahead,” without divulging any more details.
Up to early this year, the IDB had listed the project as being “in preparation” on the projects page. However, when one searches the page all that can be found are documents related to environmental studies and impact assessments for the Amaila Falls project.
Repeated attempts to speak to officials of the IDB including Representative Sophie Makonnen proved futile despite leaving messages with receptionists and secretaries.
Financing from the IDB for the project is said to be critical for the achieving of financial closure, said Sithe Global officials who were here earlier in the year.
Budget cuts made by the combined opposition in Parliament claimed a sum of $16.4 billion under the Low Carbon Development Strategy (LCDS) identified as government’s equity into the project, placing a further strain on efforts to reach financial closure.
In January, Sithe Global, the contractor for the hydro project, had reported that financial closure for the project would have come by June 2012. However in a letter published in the press in June they said financial closure was not possible before 2013, adding that their lenders remain supportive of the project.
According to Sithe Global officials, the IDB had concerns over the size and scale of the project relative to the size of the country and the sophistication of the utility.
The officials said further delays could see this present window of locking in a fixed price being closed and increasing the possibility of the final cost of the project escalating further. They said that as it stands, the cost of the project is US$840 million, increased significantly because of currency movements, commodity prices and political risk insurance that had to be sought for the financing of the project.
