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Contractor washes hands off
KATHMANDU, NOV 15 - In an unprecedented event, the main civil works contractor – Dywidag-Dragados-CWE Joint Venture (DDC JV) – of the 70-megawatt Middle Marshyangdi Hydroelectric Project, unilaterally terminated the contract today.
Though an official reason behind the move is yet to come, the German Embassy in Kathmandu cited ‘violation of contractual obligations’ as the reason for terminating the contract, without elaborating further.
The decision follows Germany’s pledge to provide additional funds through KfW, the German Development Bank of almost 150 million euros to cover the project deficits.
Regretting the unfortunate development, the embassy in its statement said today that it could not only deal a severe blow to the project but also affect the long-standing economic cooperation between the two countries. The embassy, however, has assured that it would do utmost to resolve the problem.
The contractor’s abrupt unilateral decision has taken everyone by surprise.
“I did not have any information in this regard until this evening, ” said Dr Janak Lal Karmacharya, managing director of the Nepal Electricity Authority (NEA).
Equally astonished was the project manager Govinda Sharma Pokharel.
Fischner JV, the project’s consultant, had informed the project office earlier in the day that the works could be resumed within the next 2-4 days, he said.
The consultant had sent a letter to the project office outlining four conditions for resumption of the project works viz; army in uniform should patrol the project site, use their own vehicle, remove the curfew and reinforce security at the project site, he informed.
Following the consultant’s recommendation, DDC JV had suspended the entire construction works indefinitely since October 10 citing worsening security in the area.
The contractor had been claiming about 24 million euros in compensation for the losses suffered, which according project sources, might be one of the prime factors leading to this incident. But Pokharel said that the contractor was already paid 2.45 million euros following the consultant’s recommendation. “As per the agreement, we paid them within 108 days from the date of the claim,” he said, “and we’re also about to pay the remaining amount upon assessment.”
Posted on: 2003-11-14 08:23
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