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Lloyd Gumbo Senior Reporter
The State Procurement Board made a U-turn under unclear circumstances in awarding tenders for two solar projects worth US$183 million each to losing bidders. The SPB initially turned down a request by the Zimbabwe Power Company to engage Intratrek Zimbabwe and ZTE Corporation for other projects because their offers were too high.
The two firms lost the tender for a 100MW solar plant in Gwanda to China Jiangxi Corporation.
Six firms bid for the tender that was opened on July 5 and closed on July 23, 2013. The power utility requested SPB to approve engagement of the two companies without opening another tender.
SPB principal officer Mr Cledwyn Nyanhete on January 21, 2014 wrote to ZPC managing director Engineer Noah Gwariro advising him that the request had been turned down.
However, it is understood that the letter was never delivered to the ZPC. “At meeting No 1/2014 held on January 16, 2014, the State Procurement Board noted with concern that;
“The scope of the tender was 100MW not two projects as proposed. The variation of scope midway the process would have been unfair to bidders whose quotations had been prepared on that basis of a single 100MW power plant.
“The RFP (request for proposal) did not provide for a multiple award, neither did it contain a lot-limitation clause to justify departure from the rubric at Section 31 (i) (m) of the Procurement Act which requires that; a procuring entity shall accept whichever valid tender that offers the lowest price,” reads Mr Nyanhete’s letter.
He said proposals for variation of scope and award criteria constituted violation of Section 34(5) of the Procurement Act, which provides that a procuring entity shall evaluate the qualification of suppliers according to the criteria or requirements set in the documents by which tenders, bids, proposals in relation to the contracts are sought.
“Your proposal to recommend acceptance of Intratrek Zimbabwe P/L bid, in light of the above provisions, was also in breach of Section 29 of the Procurement Regulations which prohibits anticipation of acceptance of a tender,” reads the letter.
The SPB awarded the tender to China Jiangxi Corporation, the lowest bidder to specification, at about US$183 million.
ZPC was penalised US$900 in administration fees for failure to follow tender procedures by varying the scope and evaluation criteria.
“Against this background, could you please proceed and enter into the necessary formal procuring contracts with China Jiangxi Corporation for international economic and technical co-operation within a period of 30 days from date of receipt of this letter.
“Please note that you are required to submit a copy of the contract within seven days of signature,” said Mr Nyanhete.
But the letter was never delivered to ZPC and SPB inexplicably made a U-turn on February 24, 2014 when Mr Nyanhete wrote to ZPC giving the green light to engage the two firms.
Mr Nyanhete said the two technically compliant but losing bidders were willing to match the cost of the lowest bidder to specification and the urgency of the requirement in light of power shortages country-wide had swayed the board’s decision.
“The accounting officer should engage the two technically compliant bidders namely Intratrek Zimbabwe and ZTE Corporation (Zimbabwe) Ltd for negotiations for additional solar power projects with similar specifications at the benchmark price of the lowest bidder to specification, China Jiangxi Corporation Ltd of US$183 703 238,81 and report to the board post facto,” said Mr Nyanhete.
The letter was copied to Intratrek Zimbabwe, though it could not be established if the same had been done for ZTE Corporation.
The two firms’ initial bids were way costlier than the winning bid but were hand-picked for two other projects. Intratrek Zimbabwe had appealed to the Administration Court over that tender but withdrew the appeal, allegedly because it became apparent they would be awarded another project.
Papers seen by The Herald indicate that the winning bidder, China Jiangxi Corporation, had tendered for about US$183,7 million while Intratrek Zimbabwe and ZTE Corporation charged US$248 million and about US$358,3 million, respectively.
Other bidders were Lanlake Power (US$224 million), Afriven Investments (US$287,5 million) and No 17 Metallurgical Construction (US$323,3 million).
Procurement experts who spoke to The Herald said the SPB had no legal basis to direct negotiations even if ZPC had approached them after the tender closed.
An insider said it boggled the mind that Intratek and ZTE were suddenly able to reduce their bids by tens of millions of dollars, and by more than half in the case of the latter firm.
SPB chairperson Mr Charles Kuwaza promised to respond to emailed questions on Wednesday but had not done so by time of going to print.
Online Reporter