Review applications seeking to halt Sh53b pipeline tender dismissed

The Public Procurement Oversight Authority has dismissed review applications by three companies that were seeking the halting of a Sh 53 billion tender for the construction of a pipeline by the Kenya Pipeline Corporation.

PPOA has also ordered the pipeline MD to institute investigations how China Wu Yi company got possession of confidential government report contrary to the law.

Employees of pipeline to be also investigated for colluding with China Wu Yi. Give report to the chairman in 21 days.

Debarment proceedings instituted against the Chinese company.

Background of award

The Kenya Pipeline Company is to construct a new white oils pipeline from Mombasa to Nairobi to replace the existing Line-1.  The new pipeline shall be tied in to 4 new pumping stations and subsequently decommission the existing pipeline.

The scope of the project is to supply, deliver, construct and commission a 20” diameter pipeline including laying of FOC within the KPC’s ROW from Mombasa to Nairobi, optimize the use of the existing stations including the associated works and augment the system to allow for new facilities in the existing stations, including four pump stations (PS1, PS3, PS5 and PS7), four terminals (PS9, PS10, PS12 and PS14), and four future pump stations (PS2, PS4, PS6 and PS8). In addition, the project includes upgrade of existing fire fighting systems in existing stations and design of new fire fighting systems for new stations.

The subject tender was first advertised as an Expression of Interest (EOI) for Construction of the Proposed Mombasa-Nairobi Petroleum Products Pipeline Project, on Wednesday 16th January, 2013 in the local dailies and the same closed on 28th February, 2013.

Forty (40) EOIs were submitted and underwent evaluation, after which thirteen (13) firms were shortlisted to proceed to the next stage of tendering i.e. Request for Proposal stage (RFP). The Procuring Entity’s Tender Committee, at its sitting TCM No. 22-2012/2013 of 16th April, 2013, approved the thirteen (13) shortlisted firms to proceed to the RFP stage. Both the successful and unsuccessful firms were informed of the outcome vide letters dated 25th April, 2013.

RFP documents were issued to the 13 shortlisted firms on 5th March, 2014. Following inquiries and requests for clarification and extension by some bidders and subsequent issuance of addenda, the closing date of 17th April, 2013 was extended to 8th May, 2014, and subsequently to 15th May, 2014.

At the closing date of 15th May 2014, nine (9) out of the thirteen (13) prequalified firms submitted their bids for the tender for Construction of the Proposed Mombasa-Nairobi Petroleum Products Pipeline Project.\

The Preliminary Evaluation commenced on 22nd May, 2014.    The Applicant (M/s Kalpataru) and an Interested Party (M/s Avic International Holding Corporation) were the two bidders that failed to satisfy all the mandatory requirements and thus did not qualify to move to the Technical Evaluation stage.

The Technical Evaluation Committee proceeded to evaluate the tenders based on the criteria set out in the tender document. The results of the preliminary and technical evaluation were presented to the Procuring Entity’s Tender Committee, and thereafter communicated to all the bidders on 26th May 2014.