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Bheramara power tender awards hit controversy

Star Business Report
The North-West Power Generation Company (Nwpgc) has controversially qualified two tenders and disqualifies two others in the technical evaluation bids for the Japan-funded Bheramara 360-megawatt power project.
An evaluation report oddly mentions that none of the bidders met the qualification criteria set by the tender rules. Then it contradictorily qualified Japanese bidders Marubeni and Sumitomo and disqualified Japanese-Korean Mitsui-Posco and Spanish Duro Felguera.
Among the ones who qualified, Marubeni's bid had serious shortcomings according to the tender's conditions. In contrast, the Mitsui-Posco and Duro Felguera bids had negligible shortcomings.
The financial offers of the two technically qualified bidders would be opened after the project's financier Jica accepts the evaluation, said an Nwpgc official.
This was done to oust bidders that proposed using General Electric (GE) and Siemens turbines for the power plant, the official added; Mitsui had proposed equipping the plant with a GE turbine, Duro Felguera with Siemens.
On the other hand, Marubeni proposed using a Mitsubishi Heavy Industries (MHI) turbine and Sumitomo Alsthom. GE and Siemens turbines are cheaper than that of the MHI and Alsthom in terms of price and maintenance.
Nwpgc took a few months to make this evaluation and sought clarifications from the four bidders two times.
According to the evaluation, Mitsui and Duro Felguera were disqualified on the grounds that their GE and Siemens turbines did not meet the 'vibration' requirements of the tender. GE is the world's largest turbine manufacturer while Siemens is the second largest.
Other reasons shown for the disqualification include—the filter system of gas turbine air intake is not washable, explosion proof motors are provided as optional items, piping, cables and installation of generator control panel will be provided by a third party.
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The disqualified bidders were not asked to clarify these small issues during the clarification process as these do not have an impact on the project's price, although clarification notices were served on them twice," said an official.
Marubeni's bid had three serious deviations that have implications on the project price; one was ignored and there was scope to modify the two others, which is a violation of tender rules, the official added.
Its biggest shortcoming was that the company refused to accept the project's 'geo-technical risk' and proposed to assess such a risk after a study, once the contract is awarded. In that case, Marubeni's proposed price for the project would change after a contract is awarded.
Marubeni also refuses to accept the responsibility of obtaining the transmission line and its associated costs in the right way, and
declined to accept the required responsibility to guarantee the availability of spare parts for 10 years. These two issues were allowed to correct.
According to JICA's procurement rules, no bidder shall be requested or permitted to alter the bid after the bids have been opened. Only clarifications that do not change the substance of the bid are acceptable. The borrower may ask any bidder for a clarification on the bid, but would not ask any bidder to change the substance or price. The rule adds, "If any bid has a material deviation, reservation or omission, it is to be rejected."
Marubeni won two power projects in recent times with the same power generators. But in both tenders, the authorities had controversially disqualified other bidders and the company won the contracts as lone bidders. This time, however, it would have to compete with Sumitomo.