Pokhara Airport project: Contractor ready to develop project at govt estimated cost
KATHMANDU, JAN 16 -
China CAMC Engineering Co, the lowest bidder for the proposed regional international airport in Pokhara, has expressed willingness to develop the project at the government estimated cost.
In a letter dispatched two weeks ago to the Civil Aviation Authority of Nepal (CAAN), the company showed willingness to construct the project as per the CAAN’s bill of quantities (BoQ), according to a highly-placed source at the Tourism Ministry.
“The Chinese company’s offer is positive and the government should seize it,” the source said.
The BoQ is a document used in tendering process that details project costs, the terms and conditions of the construction to enable the contractor to develop the project as per its estimated price.
The CAMC had quoted $305.13 million for the project amongst three shortlisted Chinese firms, whereas the government had estimated the project to cost between $166 and $170 million.
The source, however, pointed out a legal complexity before taking the project deal ahead. As per the rules, a project bid/tender stays valid up to 120 days after the final evaluation of the qualified bidders.
“CAAN or government officials will have to bypass the law to get the project moving ahead. And they cannot afford to take such risk. The only alternative left now is to proceed with a political consent,” the source added. On February 9, 2012, CAAN had invited bids to build the project under the Engineering Procurement and Construction model. But it was forced to extend the deadline twice due to intervention by the Commission for Investigation of Abuse of Authority.
On July 18, 2012, CAAN’s tender evaluation committee had opened the financial proposals for the project, the lowest bid was 85 percent higher than the government estimate.
Subsequently, the project was dragged into a controversy with CAAN’s unions opposing the deal arguing that the project was not economically viable under the authority’s existing financial status.
On the other hand, people of Pokhara have demanded that the project—that has remained idle since 1975—be executed this
time around. They have organised a series of protests against the government failure to construct the airport.
The government had planned to borrow around $145 million in soft loans from the Export-Import Bank of China (Exim Bank) to fund the project.
A detailed study for the airport project in 1989, conducted by the government in association with the Japan International Cooperation Agency, had proposed a runway 2,500m in length and 50m in width, a terminal and a cargo building. The construction of the airport, expected to be completed in four years, was estimated to cost $ 39.6 million at the time.
Source: The Kathmandu Post
