Chamal seeks to cancel South Port tender

By Indika Sakalasooriya
Ports and Aviation Minister Chamal Rajapaksa on Thursday sought cabinet approval to cancel the controversial Colombo South Port tender.

The Minister in his cabinet memorandum stated that before taking a final decision, the Cabinet Appointed Negotiating Committee (CANC) considered the views of the Project Committee (PC), the views expressed by the Board of Directors of the Sri Lanka Ports Authority (SLPA) pertaining to the project, the views of the Attorney General on matters referred to him arising there from and the cabinet decision taken on January 30.

On January 30, President Mahinda Rajapaksa submitted a proposal to the cabinet that national interest should be secured in recommending tender awards (which was exclusively reported in The Nation on February 17).

In his cabinet memorandum, the Minister further stated that the CANC has, however, noted that the concerns mentioned above had not been incorporated in the Request For Proposal (RFP) at the outset and also that it was uncertain whether the considered concerns capture the entirety of the national interest concerns as required in the cabinet decision dated January 30.

“The CANC has, therefore, reported that it is unable to conclusively evaluate the ranking of the short-listed bidders without any grave risk in violating the RFP conditions, as well as the cabinet decision taken on January 30. Hence, they have recommended that the present RFP process be cancelled and reconstitute the CANC and the Project Committee to deal with the issue of new RFP that will fulfil the requirements of the cabinet decision dated January 30,” Minister Rajapaksa added.

The proposed expansion of the Colombo Port consists of two components; the construction of a new breakwater, and dredging, which is referred to as harbour infrastructure works.

The infrastructure work was to be undertaken utilising a loan by the Asian Development Bank (ADB) and the construction of terminals was to be completed by utilising private sector funds on PPP-BOT (Public Private Partnership-Build Operate Transfer) basis.

The Sri Lankan Government appointed the CANC and PC to request proposals from international and local firms or consortia and the PC was expected to evaluate technical capabilities and prior experience. However, the financial proposals were kept sealed.

The technical evaluation was carried out based on the marking scheme given in the RFP and evaluation guidelines issued by the CANC prior to the opening of the bid. Hutchison Port Holdings Ltd. (HPH), Hayleys-Carsons-Terminal Link SA Consortium and PSA-Aitken Spence Consortium obtained pass marks above the cut-off given in the RFP as 60%.

The majority of the CANC and the PC identified the PSA-Aitken Spence as the first ranked bidder tallying with the RFP approved evaluation criteria and marking scheme. However, on grounds of ‘national interest,’ the Colombo Port Expansion Project is presently on hold.