Corporate News
A technician inspects a geothermal well. The High Court has stopped
KenGen from signing a contract with RentCo East Africa for supply of
geothermal units at Ol Karia until a tender dispute is determined. PHOTO
| FILE
By BRIAN WASUNA, bwasuna@ke.nationmedia.com
In Summary
- OJSC Power Machines claims power generator awarded supply tender despite being aware rival firm did not meet requirements.
Russian firm OJSC Power Machines has accused electricity generator KenGen
of favouring a rival company competing for a Sh14.4 billion tender for
the supply of geothermal power generation units to be used in the Ol
Karia V plant.
The firm has sued KenGen for awarding the
multibillion-shilling deal to RentCo East Africa, which it says did not
meet the tender requirements with regard to years of operation.
It holds the KenGen concealed the fact despite finding out the information earlier this year during separate tender proceedings.
Justice George Odunga last Thursday issued an order
stopping KenGen from signing a contract with RentCo’s consortium until
the suit is determined. OJSC’s consortium holds that RentCo was
incorporated in June 2012 hence did not meet the three years’ experience
requirement to win the tender.
RentCo partnered with IT firms Toshiba and Lantech
in its bid while OJSC presented a combined bid with TransCentury and
Civicon Limited.
OJSC’s petition at the Public Procurement
Administrative Review Board (PPARB) was dismissed. It says it discovered
the alleged irregularities after the appeal was determined.
“RentCo would not have been in a position to attach
most recent three-year audited financial statements having only been
incorporated on June 6, 2012.
“KenGen was well aware of this fact having
previously, by a letter dated 12th June 2015, disqualified RentCo with
regard to Expression of Interest for Consultancy Services for
Rehabilitation of Ol Karia 1,” OJSC’s lawyer Philip Nyachoti says in
court papers.
The deal was to see the winning bidder lease and
install geothermal power generation units at Ol Karia V. KenGen expects
to earn at least Sh823 million annually in revenue from electricity
generated at the plant.
The winning firm is also expected to maintain the power generation units.
KenGen and the PPARB are yet to respond to the
suit. Justice Odunga granted the two firms until October 19 to file
their replies. RentCo’s consortium has been enjoined as an interested
party.
The OJSC consortium holds that KenGen’s move was
aimed at hoodwinking the PPARB into upholding the electricity generation
company’s decision to award RentCo and Toshiba the tender.
The group adds that the PPARB declined to consider allegations of favouritism it had raised against KenGen.
It now wants the High Court to reverse the PPARB’s
decision on grounds that KenGen’s alleged deceit invalidates the tender
award to RentCo.
“The PPARB erred in fact and in law in failing to
review not only the allegations made in the request for review before
it, but also to review the entire procurement with regard to the
tender,” the OJSC consortium holds.
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