The Guyana Government is forging ahead to recover all mobilisation fees paid to Trinidadian contractor, Kalco Guyana Incorporated, which failed to complete its portion of the work on the Conversation Tree to Dennis Street Road Expansion Project.
Public Works Minister, Juan Edghill, disclosed that this was one of the agreements coming out of the termination negotiations with the T&T company. He told the Guyana Times on Sunday that his ministry and the contractor have ironed out all the measures including payments and that the termination agreement is slated to be finalised in the coming weeks.
“In keeping with the terms and clauses of the contract, Kalco has agreed to exit the contract in a non-adversarial manner,” the Public Works Minister stated.
Edghill added, “Government will recoup every dollar for the mobilisation advances paid and Kalco will receive payments for all measured works done.”
Initially pegged at $1.8 billion, the Conversation Tree to Dennis Street Road project was split into two lots, with the first lot having already been completed by S. Jagmohan Construction and General Supplies Inc.
However, the second phase, which was awarded to this Trinidadian company, has been stalled for several months now, and that contractor has been flagged on multiple occasions for poor performance.
Even though the initial project deadline was set on November 5, 2023, during an inspection conducted on March 4, 2024, it was indicated that Kalco had instructed its engineers to halt operations and no other work has been done since.
Consequently, the government had announced earlier this month that it is moving to terminate the $830 million contract with Kalco after the company “did not live up to expectations.”
The Public Works Ministry subsequently activated the process to terminate the contract with the Trinidadian contractor.
On April 13, Minister Edghill and his team had a virtual meeting with the principals of the company to iron out the conditions of the termination. Negotiations had been ongoing since then and an agreement was reached between the two sides.
Earlier this month, President Dr. Irfaan Ali and a technical team inspected the uncompleted section of the road, and the Head of State instructed the team to find a way forward to complete the stalled works.
Following a meeting with the technical experts on April 13, the Public Works Minister had told this newspaper that several decisions were taken on going forward with the project including finding a new contractor to complete the road.
Asked on Sunday, whether there was any progress on that front, Edghill opted not to comment on this aspect since they are still streamlining everything.
The minister had previously explained to this publication that, “…The project will be completed… [But] we have to determine what rates would be charged, and what it would cost coming out of this contract and giving it to somebody else – what is the extra cost and all the rest of it, because that is a contract that had been issued now two years ago… So, there are a number of things that have to happen. You don’t just take something from (one party) and give it to (another party), there is a process.”
Nevertheless, as the technical team works on advancing the project, President Ali has ordered during his April 13 site visit that immediate drainage and irrigation works be done at the unfinished section of the road in the meantime, to avoid flooding in the event of heavy rains.
“We have to do some D&I work here because I don’t want this remaining work to cost us. We have to make some decisions here,” the President had stated.
This move by the Government to end the contract with the Trinidadian company comes on the heels of efforts to clamp down on contractors that are lagging on projects being executed for the state.
Just at the beginning of this month, during a meeting with representatives of ministries and agencies responsible for awarding and monitoring Government contracts, President Ali had ordered that penalties outlined in several Government contracts be enforced for companies that continue to default on their contractual obligations.
At that meeting, the Guyanese Leader also instructed that project updates for several ongoing works be completed for review, and according to Minister Edghill, work has been ongoing to fulfil the President’s order.
The project updates will be provided to the Attorney General and Legal Affairs Minister Anil Nandlall, S.C., and letters of notice would be issued, while the Finance Ministry is tasked with calculating the liquidated damages.
Further, the Head of State disclosed that action must now be taken to strengthen project management teams in the public sector. Consequently, units are now being established at the various ministries and state agencies to assess the performances of contractors carrying out Government projects.
Additionally, a Contract Compliance Unit has been established at the AG Chambers to support the work of those units. President Ali had noted that all project managers and senior engineers under this unit would be properly qualified and it was subsequently announced that 50 scholarships would be given to 50 officers from various fields to better monitor and evaluate projects.
