ISLAMABAD: Serious discrepancies have been found in the process of award of Rs5 billion contract for the Keyal Khwar hydropower (KKHP) project being executed on the Indus in Kohistan district of Khyber Pakhtunkhwa under a plan to overcome loadshedding in the country through foreign funding.

The contract for the 128MW project being financed by Germany is being contested by two consortia — Andritz Hydro consortium and Voith Hydro-Sino Hydro Bureau 7 consortium.

Documents available with Dawn reveal that a German consultant pointed out serious shortcomings in the bidding process, but the Water and Power Development Authority (Wapda) ignored these and included Voith Hydro in it.

The consortium filed the lowest bid of Rs4.86bn that was opened in Dec 15, 2016.

Keyal Khwar hydropower project is being executed on the Indus in Kohistan district

According to the German consultant firm Lahmayar International, the lowest bid of Voith Hydro was declared failed and rejected. The firm’s consultant Rainer Goetz recommended that the bid of Voith Hydro be returned as per provisions of the bidding documents.

However, the consultant declared the bid of Andritz Hydro sole responsive. The technical bid of the consortium — Rs5.08bn — was declared pursuant to the provisions of bidding documents and recommended to be opened at a suitable date, time and location by the employer (Wapda).

“Voith-Sino Hydro consortium remained failed to meet criteria of design, supply, installation, testing and commissioning of main inlet spherical valves with a diameter of 1m or larger with design heads not less than 6.5MP; design, supply, installation, testing and commissioning of ODAF type transformers 132kV/11kV larger than 60MVA; criteria of contracts involving HVAC and auxiliary systems for underground HHP and did not qualify to submit its bid and thus be rejected,” the consultant’s report said.

A World Bank report reveals that the bank had in June last year imposed a sanction on one of the contesting firms — Sino Hydro — for being involved in fraudulent practice in a WB-funded project.

However, both the consortia had given undertaking to Wapda that their companies had not been included in the list of sanctions of any international body.

When contacted, Wapda’s spokesman said the project’s consultant declared the two consortia — Andritz Hydro and Voith Hydro — substantially responsive and ‘conditionally’ qualified firms for the contract.

“The technical and financial bids of these two consortia were opened on Dec 15, 2016. Evaluation of the bids submitted by the consortia is under process and, therefore, information relating to evaluation of the bids cannot be shared at this point in time in line with the bid documents,” he added.

When asked about the World Bank’s sanction on the lowest bidder in another project, the spokesman said Wapda, being an organisation of national stature, always adhered to rules, regulations and best practices in a transparent and competitive manner for awarding contracts of its projects, and these were also being followed during the evaluation process for award of electrical and mechanical contract for the KKHP project.

He said the evaluation process would be finalised in accordance with the rules of the Public Procurement Regulatory Authority and the Pakistan Engineering Council, as well as other financial institutions, including KfW of Germany.

Talking to Dawn, Zafar Iqbal, Wapda’s former project director for KKHP, said the bids of both consortia had some shortcomings and, therefore, they had been asked to improve their bids after their opening. “The shortcomings which do not affect the bill (cost of the contract) can be improved even after opening of bids,” he added.

When contacted, Farooq Khan, local representative of German consultant firm Lahmayar International, was reluctant to comment on the findings of the firm. “The project was being looked after by my German colleagues and, therefore, I have no knowledge about it,” he said.

Published in Dawn, January 24th, 2017