Fin24

Esorfranki keeps disputed R864m tender

2011-06-27 16:49

Johannesburg - Construction firm Esorfranki [JSE:ESR] has remained the winning bidder of the second phase of the western aqueduct project commissioned by eThekwini Water and Sanitation, the utility said on Monday.

It won the R864m tender as part of a joint venture with Cycad Pipelines but the project was delayed after complaints by losing bidders.

The start of the contract for the construction of the second phase of the western aqueduct project between Inchanga station and Ntuzuma was delayed by as much as 12 months, after three unsuccessful bidders lodged appeals and objections against the awarding of the contract to Esorfranki and Cycad Pipelines by eThekwini Council.

Civil engineering and construction group Sanyati Holdings [JSE:SAN] said in January that its bid was the lowest at R699.4m. The group said that Wilson Bayly Holmes - Ovcon [JSE:WBO] had been about 2.8% higher at R720.1m.

The matter was assessed by the City Council. All arrangements for the construction of the project were halted in June 2010, pending the resolution of the disputes as well as a subsequent court application brought against the municipality by one of the unsuccessful bidders.

Andrew Copley, eThekwini Municipality's project manager for the western aqueduct project, welcomed the end to the protracted delays.

The project would significantly strengthen the capacity of bulk water supply to the western and northern regions of eThekwini by injecting 325 megalitres daily, with the capacity to potentially peak up to 470 megalitres a day. The city's current water consumption stands at 950 megalitres a day.

In addition, excess pressure in the pipeline was planned to be converted into hydropower at two sites along the route of the pipeline - one at Hillcrest and the other at Wyebank - allowing the municipality to use this green energy to supply the electricity requirements of these suburbs.

Copley said several criteria had to be fulfilled before any tender was awarded. These included compliance with the conditions, black economic empowerment participation, price and quality.

"Because of the sheer size of the construction activities that need to be undertaken for the installation of these pipelines, and the fact that the route of the project passes through important urban (residential and commercial) areas, the construction of this project demands the appointment of a fully experienced and well-resourced contractor," he said.

 

Comments
  • Skerminkel - 2011-06-28 09:13

    Some details on why the appeals were unsuccessful would be nice. Were the bids unreasonably low or were they disqualified because they did not comply? These issues are critical in the construction industry and in public procurement in general.

  • Skerminkel - 2011-06-28 09:14

    Further to above - were the lower bidders not technically capable? "..the construction of this project demands the appointment of a fully experienced and well-resourced contractor.."

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