Thursday, 13 December 2012

Senate probes N107bn inflated East-West road contract

Senate has observed variation in the East-West Road contract amounting to N107 billion. To this end, it has asked the Ministry of Niger Delta and the contractors handling the project to explain.

Senate, through its Committee on Public Accounts, which began a public hearing, yesterday, to examine the intervention of the Subsidy Reinvestment and Empowerment Programme, SURE-P, on the various Federal Government projects across the country, said there was need for further explanation from both the ministry and contractors, as it was not convinced on the expenditures made.

It observed that Sections 1 and 2 of the of the road, which were awarded to Setraco Nigeria Limited in 2006 at the cost of N138.7 billion had been reviewed upwards to N245.7 billion.

Technical Director of the company, Dr. R. Chaudhuri, explained that the amount was to cover the construction of both sections of the road of about 87km.

He said Section 1 of the road was initially awarded for N64 billion, but had to be reviewed to N112 billion, following redesigns and insufficient materials from the bill of quantities.

He said the company had been paid N62 billion out of the N65.5 billion approved, leaving a balance of N3.5 billion and that Section 2 of the road had an original amount of N74.7 billion but had to be reviewed upwards to N133.7 billion.

He added that only N39.58 billion had so far been paid for the job, even as work done in both sections had reached 65 percent completion.

The third section of the road, covering 99km, he explained, was awarded to Reynolds Construction Company, RCC, at the cost of N56 billion, saying the amount was further reviewed from an initial N44 billion.

Members of the committee, after examining the details of the submissions, noted that with 87km costing N112 billion, the value of 1km came to about N1.3 billion.

Chairman of the committee, Senator Ahmed Lawan, while contributing to the issue, wondered why the contract would be varied for over 100 per cent.

He said: “We would like to know why the contract is reviewed by about 100 percent after the contract was awarded. Did the contractor not do his work well before bidding for the job?

“This is difficult to understand and we will need further explanations on this. The Ministry of Niger Delta should come up with details of the designs to show what design was done to warrant such an upward review.”

Responding to this, Chaudhuri said he would need to get the design papers for the committee to show the reasons why the contract sum had to be increased.

An accounting officer with SURE-P, Mr. Okogwu, explained that so far, about N8.14 billion had been released as intervention funding for the East-West Road, saying the payments for the contracts under the SURE-P projects were fast-tracked.

… as contractor vacates project site over insecurity

 WARRI—SETRACO Construction Company, handling the East-West Road project in Delta State, the multi million naira Trans-Warri –Ode-Itsekiri Bridge and other roads, has pulled out its workers, insisting on not returning to site until the security situation in the state improves.

Vanguard learnt that the management of the construction company had recently held a meeting over the security situation in the state following the abduction of one of their foreign staff two weeks ago on East-West Road site at Ughelli. The company noted that armed men also killed military personnel attached to the company and abducted another foreigner in the process.

Speaking to Vanguard on condition of anonymity, sources at Setraco said they had been asked to vacate all project sites until further notice, adding that they were all working under serious threat, though the source admitted that there was no such threat at the Trans-Warri sites.

Armed men and kidnappers appear to have resumed their nefarious activities in Delta State in the wake of the yuletide season, even as security had been beefed up in various parts of the city, which had led to gridlock in recent times.



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