Thursday, 14 April 2016

HRE SEWAGE DEAL STINKS

Harare City Council awarded a contract to a local company, Energy Resources Africa Consortium (ERAC), for the rehabilitation of Firle Sewage Works before the company was formally registered and since 2011, proceeded to pay it millions of dollars despite not having signed a contract with the company. 

The city council recently set up a seven-member team to probe the deal, valued at $13,8 million, which was supposed to start in April 2011 and end in October last year.

The investigative team comprises four councillors and three external experts — an engineer, a lawyer and an accountant. Documents made available to The Herald yesterday highlight several stinking points in the ERAC sewage treatment plant deal.

According to the documents, whereas the Harare City Council wrote to ERAC and five other companies — AMA Welders, Martin Millers, Engineering and Electrical Suppliers, Sidal Engineers and Easternfield — inviting them for “selective tender” on December 20 2010, ERAC began its registration as a company on January 20, 2011.

It only got its Certificate of Incorporation from the Registrar of Companies on February 17, 2011 after the tender had been closed on February 8, 2011.
The company is a joint venture between Energy Resources Africa owned by a Dave Mashayamombe and a South African company, Portriver, owned by Harold Crown.

According to Council minutes of March 22 2011, the Director of the Harare Water Department, Eng Christopher Zvobgo recommended ERAC and, “He further stated that it was to the best advantage of council to award this tender to ERAC since the company has specialised equipment and the prices submitted are very competitive in comparison (with) the quoted prices from other bidders above.”

However, it emerged that the newly-incorporated ERAC, to which the Council wrote a letter of award of the contract worth $13 million on April 11, 2011, did not have the equipment and assets, but used those of the subcontractor, Portriver.

Subsequently, payments were made to the company, beginning with a claim of $1,2 million that 
ERAC made 11 days after the awarding of the tender.

To date, according to the information available, ERAC has been paid a cumulative $5.8 million. Work has not been satisfactory and off schedule.

According to minutes seen by The Herald early this week, Eng Zvobgo admitted to the council’s Environmental Management Committee that the work was only about 40 percent complete.

0 comments:

Post a Comment