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Paulwell Stunned

Describes IDB's stand on EWi's Selection as 'damning'

BY BALFORD HENRY Senior staff reporter balfordh@jamaicaobserver.com

Wednesday, April 30, 2014    

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PHILLIP Paulwell, obviously stunned by the Inter-American Development Bank's (IDB's) criticism of the 381MW energy plant bidding process, yesterday described the multilateral agency's position as "a damnation on the country".

"I believe that if we are patriotic, we must see what has happened with the IDB as a damnation on our country, and the OCG (Office of the Contractor General) and the OUR (Office of Utilities Regulation) and myself must try to rectify that," Paulwell, the minister of science, technology, energy and mining, told journalists outside Gordon House.

He said that he was not asking the OCG to change its position on the process by which Energy World International (EWI) ended up being selected the preferred bidder, but he was hoping that there could be some clarification.

"I don't think (contractor general Dirk) Harrison has responded to the OUR, but I think that something ought to be said," Paulwell told the press.

The minister was responding for the first time since Monday's revelation that the IDB had rejected the selection process by which Hong Kong-based EWI was chosen to construct the energy plant.

The project is being touted to significantly reduce energy bills locally. However, the IDB said EWI's selection was not in keeping with Jamaica's procurement procedures.

Harrison, in a report to Parliament last September, said that EWI was being improperly facilitated by Paulwell in the bidding process.

Harrison added that the minister's intervention and acceptance of the bid from EWI was unfair and compromised the integrity of the process. EWI entered the process after bids had been closed, and its application went to Paulwell's ministry on its way to the OUR.

"Based upon the documentary evidence which was reviewed, it is clear that the 'goal post' kept moving to facilitate EWI's proposal, and that the process in its current form could not stand up to review," Harrison reported.

Paulwell reacted to the report, stating that the OCG would not be allowed to hinder his efforts to get cheaper energy for Jamaica.

"We cannot have the OCG derailing this matter again. It has to go forward," Paulwell stated at the time.

But yesterday he appeared to be in a more facilitating mood, after admitting that the IDB had sided with the contractor general's position, creating a major financing roadblock for EWI and stalling the energy project. He said that he was in touch with the OCG, and that he intended to visit the office to speak to the officers.

He also pointed out that the IDB's position was an indictment on Jamaica, not on EWI.

"For the IDB to say that they have a difficulty with the process, that is not an indictment on EWI, that is an indictment on the country, our country, whether or not you have other players, because the other players must be affected too," he said.

"If the IDB is saying that the rules of procurement that have thrown up EWI as the second preferred bidder, if that is flawed, then everything else must be in question," he added, pointing that EWI would not be as seriously affected by the lock-off of funds from the IDB, as it would be by the effect the highly respected bank's position would have on other financiers who could provide funding.

In a letter to Paulwell yesterday, EWI confirmed that it had placed with the Hong Kong and Shanghai Banking Corporation (HSBC) sufficients funds to meet the outstanding performance bid of US$37 million, and that the bank is finalising the wording of the bond within its legal department.

However, EWI's Managing Director Stewart Elliott told Paulwell that his company had done all that was possible within its control, and that HSBC has emphasised that the compliance procedures must be adhered to, hence the delay in completing the bond.

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