Eyebrows raised over Blue Line Deal

Construction News

Eyebrows raised over Blue Line Deal

Ch Karnchang has voiced no opposition to the Mass Rapid Transit Authority’s move to award the first construction contract for the Blue Line electric-train project to Italian-Thai Development, according to a source at the Transport Ministry.

In effect, this allows the MRTA board, chaired by the ministry’s permanent secretary Supodh Saplom, to negotiate the construction price with ITD at a meeting today.

“This should raise the question of why Ch Karnchang has conceded the first contract to Ital-Thai without any opposition, or any attempt to file a damage lawsuit,” the source said.

Ch Karnchang won the first contract when it put in a Bt10.754-billion bid for construction of the 2.8-kilometre underground tunnel from Hua Lamphong to Sanam Chai. Ital-Thai came second with a bid of Bt10.795 billion.

Later, however, the MRTA project-management consultant discovered there was a miscalculation in the price that Ital-Thai had offered and that it could be lowered by Bt60 million. The source said this was not Ch Charnchang’s mistake and the MRTA should have launched negotiations with that company. However, Ch Karnchang opted out, allowing the board to negotiate the price with Ital-Thai.

The source also raised a question over the number of bidders for the project. Though 25 bid documents were bought for the five contracts, there were only seven bidders.

Moreover, the bids were only slightly lower than the median prices, indicating a low level of competition. Some bids were less than Bt100 million below the median, which is strange for a large-scale construction project estimated at over Bt10 billion.

In addition, there was no negotiation with the bid winners to lower construction prices. This compares starkly with the bid winners for the Purple Line project, who agreed to lower their prices by about 10 per cent of the winning-bid values.

“The MRTA has not exercised its full power in protecting the government’s interests,” he said.

The agency will sign the Blue Line contracts in October.

The source also raised concern over possible political intervention at the MRTA, which is in the process of appointing a new governor.

The Bhum Jai Thai Party, which supervises the Transport Ministry, is expected to nominate Jakarwut Salyapong, a former director for the Marketing Organisation for Farmers and who previously sat on the PTT and MRTA boards. He is said to be close to influential figures in the party.

However, former MRTA governor Prapat Chongsanguan is seen as better qualified for the job, which currently entails pushing forward the extension of the Purple Line (Bang Yai-Bang Sue) and the Blue Line (Bang Sue-Thaphra and Bang Khae-Hua Lamphong).

Under the Cabinet’s May 6, 2009 resolution, the Blue Line is part of the Thai Khemkhaeng stimulus package. Of the Bt83-billion investment, Bt58.3 billion will be allocated for the 14km Hua Lamphong-Bang Khae route and Bt24.78 billion for the 13km Bang Sue-Tha Phra route.

The investment is split into five contracts: the first two are for the design, the third for the elevated rail section from Taopoon to Tha Phra, the fourth for the elevated section from Tha Phra, and the fifth for the rolling stock.

Of the five contracts, Ch Karnchang originally won three and the other two were awarded to SH-UN Joint Venture (Sinohydro Corp and Unique Engineering and Construction) and Sino-Thai Engineering and Construction

Source: http://www.nationmultimedia.com

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