The 2023 Office of the Auditor General (OAG) report says that despite fundamental breaches of the contract for the widening of the Conversation Tree corridor, the government opted for a settlement and found a new contractor.
The report tabled in the National Assembly on Thursday did not mention the name of the Trinidadian contractor, Kallco
The OAG report said that an award was made by the National Procurement and Tender Administration Board (NPTAB ) in the sum of $830M for the widening of Conversation Tree to Dennis Street corridor – Lot 8(B). The contract was signed on 31 August 2022 and was to be of a duration of fourteen months with the commencement date of 5 September 2022 and completion date of 5 November 2023. The defects liability period was one year. As at 31 December 2023, amounts totalling $465M were paid to the Contractor.
According to the report, physical verification conducted on 15 August 2024 revealed that the works were incomplete and the Contract was terminated on 10 May 2024.
“It was noted that the Contractor failed to complete the works within the contractual duration, while the advance payment was not fully recovered. These two situations constitute fundamental breaches of the contract, under GCC Clause 40.2 (f) – the Contractor does not provide the required guarantee and (g) – the Contractor delayed the completion of the works for a number of days’ correspondent to a maximum possible amount of liquidated damages as indicated in the Special Conditions of the Contract.
“In spite of these fundamental breaches of the Contract by the Contractor, the Ministry opted instead to terminate the Contract for convenience and valued the Contractor indebtedness to the Ministry in the sum of $152M”, the report said.
Questions had been raised as to why the ministry appeared to be so lenient with Kallco.
The OAG report said: “It was noted that the Ministry by way of a mutual settlement agreement, which was prepared in conjunction with Attorney General Office, took ownership of the Contractor’s equipment as part of the settlement for moneys owed to the Ministry. The equipment, with a total estimated value of $153.600M was inspected and valued by the Senior Mechanical Engineer from the Ministry of Public Works. 301. It was advised by the Ministry that the remaining incomplete works were awarded to another Contractor who was at the time mobilized on site and was in the process of constructing a sheet pile revetment along Dennis Street”.
According to the OAG report, it was advised by the Ministry that the remaining incomplete works were awarded to another contractor who was at the time mobilized on site and was in the process of constructing a sheet pile revetment along Dennis Street.
The Head of the Budget Agency said that the observations were noted. The AOG report said that the contract was terminated for convenience because the contractor could not complete the works mainly due to financial constraints. Lot 8A was completed and since these projects were to function in unison, the contract was terminated for convenience to fast track the completion of Lot 8B to better service the general public as a bypass to congested Sheriff Street.
The extension of time given, was up to 15 March 2024 due to several reasons: (i) Delays in drain construction was due to rains and this drain being the main outlet for residence; (ii) Settlement occurred in road materials due to location previously being a dumpsite; and (iii) Relocation of utilities. Recommendation: The Audit Office recommends that the Head of the Budget Agency submit to the Audit Office the valuation at termination and reconciliation of payments
Following the “amicable” end of Trinidadian company, Kallco’s work on the Conversation Tree road project, Stabroek News reported on August 1st this year that the government took possession of its vehicles and equipment to cover the advance payment that had been made to it.
Kallco’s section of the project had been severely delayed and the government had issued several warnings which culminated in the ending of its involvement earlier this year.
Questions posed by APNU+AFC MP David Patterson were answered in writing in Parliament on July 31st.
Minister of Public Works, Juan Edghill said that the original contract for the Conversation Tree project was for a sum of $830,293,458. The construction period for this contract was from September 5, 2022, to November 5, 2023.
Regarding payments made, the Minister revealed that a total of $465,223,474 was disbursed to the contractor, including advances. Notably, no liquidated damages or other penalties were imposed on the contractor for delays, as the settlement was amicable. Instead, the Ministry took possession of the contractor’s vehicles and equipment valued at $153,600,000 to recover outstanding advance payments.
In response to queries about the new contract awarded to S. Jagmohan Construction and General Supplies Inc., Edghill outlined that the Sole Source Method was utilized for procurement. This approach was chosen because the contractor had previously demonstrated effective and timely completion of the eastern section of the project and had a thorough understanding of the site.
Edghill noted that the project, which had previously caused considerable inconvenience to residents and delayed infrastructural development, is now back on track. Edghill emphasized the urgency of the project and expressed confidence that it would be completed well before Christmas.
Edghill also acknowledged the patience of local residents and their cooperation during the delays. In addition to the main roadwork, the Ministry has engaged nine small contractors to rehabilitate the boulevard along Conversation Tree, including constructing a walkway, installing lighting, and landscaping to enhance safety and aesthetics.
Further plans include extending the road network to connect Conversation Tree Road with Dennis Street and eventually Vlissengen Road. This extension aims to improve connectivity, reduce traffic congestion, and facilitate smoother navigation in the area.
The Conversation Tree Project was initially awarded by the National Procurement and Tender Administration Board in 2022. However, Kallco, the original contractor, faced significant challenges, leading to their removal from the project earlier this year. The government had previously indicated plans to terminate the contract with Kallco due to their inability to complete the work and apparent abandonment of the site.
