Showing posts with label Singapore Bitumen. Show all posts
Showing posts with label Singapore Bitumen. Show all posts

June 20, 2019

Tembec Land Road Study

Engineering study tenders awarded for Tembec land
Posted: June 18, 2019

Engineering study tenders awarded for Tembec land

Three contracts have been awarded and work is under way for the engineering of the former Tembec lands development in Cranbrook.
Mayor Lee Pratt
“It is good to see we are moving forward with the plans for the development of this industrial land,” said City of Cranbrook Mayor Lee Pratt. “With the interest we are receiving regarding availability of these lands, it is important that we get moving on it. There have already been 40 new jobs created in the two leases that we have entered with the existing buildings that were on site and sitting dormant for many years. I am looking forward to more great opportunities which will present themselves to this project.”
The first contract is for environmental engineering which was awarded to SNC Lavalin to undertake a Stage 1 Preliminary Site Investigation update, update previous tables and drawings, and then complete a data gap assessment and work plan to move forward to address environmental issues which will need to be completed for the proposed development to occur.
The second contract (civil and transportation engineering) was awarded to Urban Systems Ltd. This contract includes the transportation network study and conceptual design, survey work, civil design and cost estimates, and contract administration and field inspections when construction occurs. The transportation plan will be complete in the fall of 2019 and the final civil design being complete in the fall of 2020. Deep civil utilities (water, sewer and storm) could be installed in the summer of 2020 and road construction and shallow utilities constructed in 2021 at the earliest.
The third contract was awarded to VAST Resource Solutions Inc. for geotechnical engineering to complete a geotechnical and hydrological assessment to evaluate and reduce the area currently under restrictive covenant (no build/no disturb zone) regarding potential geotechnical and drainage hazards to future development and to provide geotechnical/drainage recommendations for subdivision road construction and utility services. The geotechnical study will be complete the summer of 2019.
Staff continues to work on the concept and the strategy for the former Tembec lands specifically around marketing and branding of the property.
The city is planning to launch a new economic development micro- site in the fall of 2019 within the city current corporate website – www.cranbrook.ca, with the Tembec lands as a central point and driver to garner interest from investors and other business interests.
Lead image:  Tembec lands proposed layout option 06.11.19. City of Cranbrook
City of Cranbrook

Source - eKnow.ca

May 30, 2019

Value for Money

Enhancing value for money in public procurement of Northern Ireland construction projects


29 May 2019
Gary McArdle and Gerard Gunning evaluate public procurement in Northern Ireland - specifically, the achievement of value for money in public construction projects; they also assess other factors detrimental to creating value, such as sub-economic tendering and the potential impact of Brexit
Civil

Abstract


The purpose of this article was to evaluate public procurement in Northern Ireland (NI) – more specifically, the achievement of value for money (VfM) in public construction projects. Other areas assessed were factors detrimental to creating VfM; sub-economic tendering; and the potential impact of Brexit in NI.
The methodology included primary and secondary data collection. The qualitative research involved six semi-structured interviews to collate the data and use of Decision Explorer to analyse it. Quantitative research was in the form of 81 questionnaire responses, analysed using SPSS.
The findings highlight influences which create VfM in public procurement, along with barriers to achieving VfM. Direct and indirect factors which contribute to public value are also established. Additionally, the potential impact of Brexit on VfM was ascertained.
The article identifies clear implications for practice, with a view of increasing VfM through public procurement procedures. An insight is provided into public procurement in NI from the perspective of both vendor (public bodies) and purchaser (contractors) – an area which appears to be under-represented in current literature.

Introduction


Procurement is the acquisition of resources required for the realisation of a project. These resources include contractors, consultants, subcontractors, suppliers and the client’s own resources.
Public procurement must be based on VfM, which is defined as ‘the best mix of quality and effectiveness for the least outlay over the period of use of the goods or services bought’.
This should be achieved through competition. Public procurement is subject to a legal framework which encourages free and open competition and VfM, in line with international and national agreed obligations and regulations.
There are sufficient strategic plans provided by NI public bodies on the delivery of infrastructure projects in an efficient manner while also providing VfM. There are a number of ways in which the procurement activities of public bodies can achieve VfM.
However, there appears to be a level of uncertainty as to the most suitable procurement approach. Additionally, there are factors inhibiting the creation of VfM such as lack of funding and long-term perspective; sub-economic tendering; and a claims culture.

Research methodology


The study used a mixed methods research approach by collecting primary and secondary data, utilising both qualitative and quantitative methods to collect, collate and analyse data. Figure 1 demonstrates the research process.
Figure 1 Research methodology
The qualitative research involved six face-to-face, semi-structured interviews with senior individuals currently working in the construction industry.
Four of the individuals work for public sector organisations, providing a range of perspectives from different specialisms.
Two of the individuals are senior managers within contracting companies currently involved in public sector projects in NI – one civil engineer and one quantity surveyor.
It should be noted that the interviewees appeared cautious with their responses due to the sensitive nature of the subject. Details of the interviews are illustrated in Table 1.
The analysis of the interviews also identified areas where further research would be required within the topic.
This was used to aid the development of a questionnaire which formed the basis of the quantitative research.
Table 1 Interview details
A total of 81 individuals working across various sectors of the construction industry completed the questionnaire.

Research outcomes


This section identifies the main outcomes of the research and provides reasoning to the main themes established. Contradictions between different aspects of research in addition are also discussed. The main themes identified include:
1. Creating public value
Public sector organisations not only create public value through the services they provide; they also create value by their approach to the provision of services including:
• Creating employment;
• Supporting the local economy;
• Helping socially deprived areas;
• Support of SMEs; and
• Consideration and protection of the environment.
The main areas requiring improvement in NI include:
• Improvements to the road network;
• Greater employment opportunities;
• Improvements to the health facilities; and
• Improvements to the water and sewerage services.
Although it did appear that VfM was being achieved, the concept of measuring public value would provide a more appropriate assessment of the delivery of public procurement policies.
2. Factors which result in less VfM and have a damaging effect on NI’s construction industry
There are various factors and practices which are detrimental to the objective of achieving VfM through public procurement.
The ‘vicious circle’ in figure 2, illustrates the main causes which are damaging the construction industry in NI. It should be noted that this is more relevant for less complex projects.
Water and roads projects are less complex projects, whereas education and health are more concerned with large complex projects. The rationale is that a new road, water main or sewer may need to be constructed to a required specification; there is less impetus for innovation, whereas the construction of a new hospital or school may be considered complex and more open to radical innovation.
Figure 2 The vicious circle damaging the construction industry in NI
The three main causes of sub-economic tendering in NI are:
a.) The client’s aim to gain VfM places increased pressure on contractors to reduce costs;
b.) The attitude of contractors. Some contractors submit low tenders simply to win the work and offset losses by drawing on more profitable sections of the business. Additionally, legal challenges prior to contract award from unsuccessful tenderers are time consuming, costly and lead to delays in the contract start date.
c.) Lack of work in NI.
During the construction phase, contractors seek claims as an approach to increase income. The increase in claims is forcing the client to ‘fight back’ and apply the contract in a more stringent manner regardless of the contractor or tender price.
Therefore, contractors are not making enough profit or possibly losing money leading to a breakdown in relationships. There is no process improvement on defining the key aspects of the tender evaluation by the client, as contractors will continue to submit sub-economic tenders to win work – resulting in the cycle starting again.
This vicious circle is proving to have a damaging impact on the construction industry in NI for both contractors and clients. The competitive industry, lack of construction contracts and unsustainable rates are proving to be a dis-incentive to larger contractors who are focusing on expanding their geographical spread to gain profitable work.
In an attempt to break this cycle, a starting point would be to obligate public-sector clients to reassess their interpretation of VfM. It is apparent that they can confuse VfM with lowest price and their current approach to place more emphasis on cost is resulting in a ‘race to the bottom’ in relation to tendered rates. Clients must realise that the lowest price will not necessarily mean the lowest outturn cost.
Current regulations have a procedure in place to assess sub-economic tenders. However, clients are happy to receive reassurance rather than exclude them to avoid potential legal challenges.
As demonstrated in the case of DRD v BBMC (2016), BBMC were awarded damages because of DRD excluding them from the tender process based on their abnormally low tender (ALT). A potential change in regulations would give clients more authority to deal with ALTs without risking the backlash of a legal challenge.
Additionally, a reduction in funding provided by the government for capital works projects is resulting in greater operational and maintenance cost. Factors such as restrictions on expenditure along with a reluctance to incur higher capital costs are resulting in greater maintenance cost, suggesting a lack of long-term perspective by public bodies. This is providing a major problem to sustainable construction procurement.
3. Factors which create VfM and proposals for improvement
Figure 3 summarises what creates VfM, based on the qualitative and quantitative research.
Figure 3 Elements that create VfM in NI public procurement
There are certain differences within the findings of the research, particularly in relation to contract strategy for large complex projects. Health and education sectors have adopted a traditional approach for the large complex works such as the new critical care unit at Royal Victoria Hospital (RVH) or the relocation of Ulster University, Jordanstown (UUJ). In each case, the design and construction stages are completed and procured separately.
However, one question in the questionnaire focused on this area for large complex projects. Two-thirds of the responses indicated that design and build would provide the best opportunity to create VfM for the client. Possible reasons for this difference in results include:
• The details provided by health and education sector representatives divulge the procurement approaches for both the consultants who complete the design and specification and the contractors. The procurement of the consultants focuses more on quality with less emphasis on price. Design competitions and ‘narrow average approaches to the cost assessments avoid low cost tenders and ensure that the best consultant is awarded the contract.
• In contrast, contractors are ultimately procured on lowest price. Following a most economically advantageous tender (MEAT) process to determine suitable contractors, the client is confident that the contract is so well defined with necessary risk allocation, that they can accept the lowest bid.
There were several suggestions for improving procurement procedures within the public sector in NI including:
• It is apparent that there is greater emphasis towards price in the price/quality (PQ) combination with an almost default position of 60/40 or 80/20 PQ ratio. However, the client is not aligning projects with adequate PQ combinations. An improved balance in the assessment between cost and non-cost criteria at tender stage is required, depending on project complexity, risks, contractor availability and client’s objectives.
• Proposed changes to the current PQQ process. Figure 4 illustrates possible suggestions for improvement in the current process.
Figure 4 Suggested improvements to the PQQ process
• It is recognised that quality responses are generic. However, clients are not willing to put emphasis on quality since it is more subjective in nature compared to cost. Ultimately, this will result in a ‘race to the bottom’ in terms of cost.
• Frameworks are accepted as an approach to gain VfM as well as reducing the adverse nature of construction procurement, but they are not utilised enough. Frameworks lend themselves to greater specialism and better workmanship, further enhancing the VfM initiative. Additionally, they provide an opportunity to save on tendering costs; form long-term trusting relationships; and improved design and delivery. Benefits to the contractor include a greater security of work through long-term programmes. However, it is acknowledged that frameworks may not be beneficial to SMEs.
• Greater leadership and planning are required to ensure procurement approaches are fair and reasonable and to reduce procurement turnaround times.
4. Brexit
Following the June 2016 referendum and triggering of Article 50, Brexit and its potential impacts is a very current topic. One of the most significant concepts is that Brexit will have a detrimental impact on public works in NI.
This includes fewer foreign contractors coming to NI for work following Brexit. Most of those who responded to the questionnaire were concerned about the potential impact of Brexit on their current work.
To support this, the main outcome from the research was ‘great uncertainty’ over future budgets a result of Brexit. NI already receives a low level of funding from the government. This is not likely to improve following Brexit.
Contrary to this, health sector personnel believe that they could potentially receive more funding in the future. However, they could not make this claim with any certainty.
Public bodies receive a certain level of funding for capital works projects and this is likely to continue following Brexit. However, current funding provided for by the EU for projects involving both NI and ROI is not likely to continue.
Another potential project at risk is the proposed York Street interchange project. The £165 million project is part of a Euroroute E01. A substantial EU contribution of up to 40 per cent could now jeopardise the project.
The consensus is that procurement policies will not change apart from how work is advertised. If it does change, the principles of competition and transparency will remain since the WTO principles would apply.
Depending on the new agreement on how the UK will operate within the EU market, a forum to advertise public works may still be required following Brexit. It is noted that the current approach to advertising in OJEU can be time consuming for little benefit.
It is recommended that the threshold levels for public works are reviewed. In several cases, the values are deemed too low. Although certain works are advertised in the EU market, ultimately it will result in local contractors only tendering for the work.
5. Future funding recommendations along with proposals for year-end flexibility
The current process for funding provided by the government is an annual budget. To create better VfM along with greater security to companies, a better foresight of budget is called for. This would allow companies to improve measures such as more permanent staff and improved training.
Year-end flexibility would be a benefit to clients and contractors. The current process of an annual budget is putting the client under pressure to spend money, particularly towards the end of the financial year.
A lack of planning on the client’s behalf is ultimately putting increased pressure on the contractor to complete the work in tighter time frames.

Recommendations


The study undertaken has potential applications to industrial practice. An insight was gained into the area of public procurement in NI.
The outcomes should be considered by the public sector to enhance VfM from the services that they deliver, in a clear and transparent process.
Due to the sensitive nature of the subject and the cautious responses received through the interviews. Further study could include Freedom of Information Requests for more objective data on relevant public bodies and projects.
The impact of Brexit on public procurement in NI and the wider United Kingdom could be further examined as the current process is based on the EU directive on public procurement.
Public bodies must realise that in order to enhance VfM, more rational thinking at an early stage into aspects such as their objectives, project complexities, project briefs, and budget forecasts, will be required.
Greater leadership and planning by the government and public sector organisations would remove pressures which lead to unsustainable tendering and would help maximise VfM for clients.
In addition to this, it would encourage more cost-effective working practices, greater innovation, better supply chain engagement and improved security to contractors.
Authors: Gary McArdle, BSc MSc, MCIWEM, CWEM MIEI, senior design engineer, Atkins Ireland Ltd; Joseph Gerard Gunning BSc, MSc, PhD, FICE, FCIOB, FIEI, FCQI, honorary senior lecturer, Department of Natural and Built Environment, Queen’s University, Belfast
http://www.engineersjournal.ie/wp-content/uploads/2019/05/a1-34.jpghttp://www.engineersjournal.ie/wp-content/uploads/2019/05/a1-34-300x300.jpgDavid O'RiordanCivilAtkins,construction,Queen's University Belfast
Abstract The purpose of this article was to evaluate public procurement in Northern Ireland (NI) - more specifically, the achievement of value for money (VfM) in public construction projects. Other areas assessed were factors detrimental to creating VfM; sub-economic tendering; and the potential impact of Brexit in NI. The methodology included...

May 27, 2019

BOT- Built to Suck the Blood

NHAI eyes Rs 5,000 crore from roads bidding

To seek bids for roads under TOT plan in Uttar Pradesh, Bihar, Jharkhand and Tamil Nadu next month

NHAI, Uttar Pradesh, Bihar, Jharkhand, Tamil Nadu, Asset monetisation, Road auction, ToT, Macquarie Group, Brookfield Asset Management, IRB Infra, ROADIS, Cube Highways, Adani Infrastructure
The government will soon offer 550km of roads to private companies to operate and collect tolls, in a move to get cracking on an asset monetisation plan.
The National Highways Authority of India will seek bids for the roads under the toll-operate-transfer (TOT) plan in Tamil Nadu, Uttar Pradesh, Bihar and Jharkhand next month, expecting to fetch about Rs 5,000 crore.
Details of the third round of auctions are expected to be finalised soon and bids will be invited in a month.
The government introduced the TOT model in 2016 to monetise publicly funded highways. Under the programme, investors make a one-time lump sum payment in return for long-term toll collection rights. The current TOT offers a 30-year lease.
The government is pursuing the TOT model to help raise resources in the sector and attract private funding, which has remained subdued. The first round of TOT auctions for 680 km of highways ended in February 2018.
It fetched the government over Rs 9,000 crore. The Macquarie Group won with a bid of Rs 9,681 crore against NHAI’s estimated value of Rs 6,258 crore. Brookfield Asset Management, IRB Infrastructure and Roadis-National Investment and Infrastructure Fund were among the other bidders.
However, the second auction was cancelled in February 2019 after it drew a lukewarm response. Cube Highways, a toll road operator backed by I Squared Capital and International Finance Corporation, bid Rs 4,612 crore against the base price of Rs 5,362 crore. Bids were also received from Adani Infrastructure and IRB Infrastructure in the auction. The expectations of bidders and the government in the second round did not match, the official said.
The NHAI expects the third round to succeed after making changes to the TOT framework to make it lucrative for the private sector.The NHAI expects the third round to succeed after making changes to the TOT framework to make it lucrative for the private sector. It had initially planned to re-bundle the 586 km stretches offered in Rajasthan, Gujarat, West Bengal and Bihar in the second round, but decided to offer fresh assets in the third round.
“We are coming out with new stretches… A decision will be taken later as to how to re-bundle TOT round 2,” an official said.
With the Bharatiya Janata Party government winning a second term, long-term institutional investors sense stability in the Indian market as a result of which better responses can be expected in the fresh round of auctions, said Vinayak Chatterjee, Chairman of Feedback Infra.
“It’s great to see NHAI coming up with fresh auctions in a short time. The roads ministry is setting a precedent in the asset monetisation plan of the government. I hope NHAI has learned from the first two rounds in setting the floor price this time,” Chatterjee said.
“We have taken all precautions that our initial estimated concession value (base price) is realistic and there are no issues, to a large extent, in these projects…. These should attract bidders,” the official said. The stretch to be offered in Tamil Nadu is “quite significant,” the official said. However, the official declined to share details because approvals are still being obtained.

Sourc

May 24, 2019

REDUCING LUST FOR LOANS


• The PPP model for the JKIA-Westlands Expressway is only one example of a growing trend for private companies to connect in Kenya.
• The PPP model encourages private companies to compete to build a better road for less money. It encourages competition and professionalism.
Road partnerships
Road partnerships
The national debt has gained a lot of coverage, especially in light of President Uhuru Kenyatta’s visit to Beijing for the Belt and Road Initiative.
Many commentators expected Uhuru to sign an agreement to borrow Sh360 billion from China to extend the SGR, placing Kenya further in debt.
However, to the surprise of most outside of Uhuru’s inner circle, the paradigm has completely changed
Instead of asking for more money, Uhuru understands that a different approach is necessary.
Returning from China we learned that Uhuru’s great achievement was securing a public–private partnership (PPP) to build an 18km speed road — the JKIA-Westlands Expressway.
The road will be built and owned by the China Road and Bridge Corporation (CRBC) and work is expected to begin in August. The Sh65 billion road starts at JKIA and ends at James Gichuru, along Waiyaki Road, in Westlands.
This deal is not just a game changer because it will be the first road of its type on the  African continent with underpasses, overpasses, exits and the Bus Rapid Transit (BRT) system lanes covering the entire stretch.
Nairobi traffic is notorious, among the worst globally, and the current JKIA-Westlands Road is a nightmare for anyone creeping bumper to bumper on it. The World Bank estimates that Nairobi’s traffic jams cost the country about Sh50 million daily in lost man-hours.
The four-lane super expressway will navigate downtown Nairobi, and ease the daily commute for many and ensure travellers to the airport no longer have to risk missing their flights because of traffic.
Most importantly, the PPP model shows a new strategy to build the infrastructure desperately needed without placing the nation further into debt.     
Under the PPP framework, private companies will build, maintain, and operate the roads. They then charge motorists to recoup their investment after which they transfer ownership of the roads to the government. It is a win-win situation for all.
Kenyans get their new roads and reduce traffic; private companies will make a profit for their work and the government will be able to remove an expensive necessity from its budget.
The PPP model for the JKIA-Westlands Expressway is only one example of a growing trend for private companies to connect Kenya.
Other roads to be built using the PPP model include the Nairobi-Mombasa expressway and the Nairobi-Mau Summit highway. The American firm Betchel will fund the Sh300 billion Nairobi-Mombasa Expressway, work is to start by June.
The Kenya National Highways Authority announced recently that it would soon declare the winner of Nairobi-Mau Summit highway bid.
The PPP model also encourages private companies to compete to build the better road for less money. It encourages competition and professionalism.
If a company wins a tender and builds a substandard road, it knows it can lose the tender and be barred from bidding in the future.
The reason so many high-level international firms are willing to put so much money into infrastructure is because Kenya is now an attractive investment hub.
Under President Uhuru Kenyatta, Kenya has greatly improved its ranking for ease of doing business. In 2018, Kenya rose to 61 from 80 in 2017, and 92 the year before. Kenya was also ranked seventh on the list of improvers globally.
This is vitally important because research released by the World Bank in 2012 indicated that a one per cent increase in the 'Doing Business' score amounts to $250 million to $500 million of foreign investment.
Uhuru has made Kenya an attractive investment destination and this has enabled him to move from the model of seeking  foreign loans to an improved model of PPP.
Temba is an adviser to Devolution Cabinet Secretary Eugene Wamalwa
Source- The Star

March 15, 2019

Road Tender Fight

End tender fight for road project

litigation
We don’t need litigation. We badly need that road. FILE PHOTO | NMG 
Two international investors are engaged in what promises to be an explosive battle over the lucrative $1 billion contract for building of the 175 kilometre Nairobi-Nakuru- Mau Summit Highway under the so called Public Private Partnership (PPP) deal.
On one corner of the ring is a consortium led by French group Vinci Meridian and on the other a consortium led by a Portuguese group that also includes French players, dubbed Rift Valley Connect (RVC).
Already, RVC- on being informed that the Kenya National Highways Authority (KeNHA) has decided to give the contract to their competitors - has moved to lodge a complaint with the Public Private Partnership Petition Committee, the entity that listens to grievances lodged by parties who feel cheated.
It is not a good sign at all because this matter may drag in litigation and contestation for months. If I were asked to mention the greatest drawback to implementation of PPP projects in Kenya I would say delays from unending litigation.
The situation has been made worse by inbuilt weaknesses in a procurement regime and system that puts too much emphasis on too many inane rules, procedures, documentation and notices.
With the emphasis on process, rather than bigger issue of public interest such as value for money and the fact that we badly need a new road through the most important transport corridor in East Africa, it is very easy for the contracting authority or even the competing contractors to commit slip ups and lapses in the interpretation of rules.
Instructively, the major cause in the current dispute is a mundane disagreement over the interpretation of income tax laws.
That since both consortia - in preparing their financial bids- contravened the Income Tax Act of Kenya, the two bids should have been rejected. I do not want to discuss the merits or demerits of the matter because the issue is now before a tribunal.
But there are broader policy questions that this dispute raises. If you asked me, I will tell you that what I want are PPP procurement systems that work for Kenyans. The present regime was designed so that we spend taxpayers’ money paying the army of consultants that must be hired for these transactions.
And, they come in different shapes. Transaction advisers, PPP specialists and even the big audit firms all queue at the Exchequer’s trough.
I hope that this important project will not be held hostage by unending litigation. Under the present arrangement, the PPP tribunal must dispose of the dispute in 10 days.
In litigious Kenya, it does not work. A good procurement system must deliver speed, finality and cheapness. But we have an arrangement that works like a casino.
When – as a contractor- you lose at the PPP tribunal- you double your stakes and take your case to the High Court. When you lose there, you triple your stakes and escalate the matter to the Court of Appeal. A number of PPP projects have not been able to move after intervention by the Ethics and Anti-Corruption Commission that is also not famous for disposing of matters expeditiously.
If the disappointed contractor still ends up losing in all these players, they have the leeway of sponsoring parliamentary inquiries. In Kenya, some disappointed contractors resort to sponsoring civil society organisations and non- state actors to litigate over procurement matters on their behalf.
One of the very first cases to be heard by the PPP tribunal was a case filed by Kituo Cha Sheria, challenging the constitutionality of the appointment of members of the tribunal. It was no coincidence that this matter came up just as the PPP tribunal was preparing to hear what turned out to be a politically explosive concessioning of the second container terminal at the Mombasa Port.
The Northern Corridor is the busiest and most important highway in East and Central Africa, the gateway from Mombasa to several countries. If I were the one making decisions, I would call the two winning bidders to a conference and see whether they can reach some form of accommodation. We don’t need litigation. We badly need that road.