CUC names Kansas firm to review bids

After a four-month search, the Commonwealth Utilities Corporation finally has hired an independent engineering firm to re-evaluate all proposals submitted by 13 companies for the new 80-megawatt power plant on Saipan that has come under a storm of protests, officials said.

Burns & McDonnell, based in Kansas City, Missouri, has signed an agreement with the government-owned utility firm to conduct another round of review and determine the best offer, according to a CUC statement.

The firm will receive more than $49,000 in payment for its services, but will have an option to handle final negotiations on the $120 million project if the CUC board decides to hire them for the second round of deliberation.

It stands to earn additional $50,000 in engineering fees should the review move on, utility officials said. “The board next has the option to enter into a second phase with Burns & McDonnel if it chooses to let them handle the final contract negotiations,” they added.

The U.S. engineering firm edged out two other companies which responded to two requests for proposals issued by CUC over the past few months since its decision to hire an independent evaluator last September.

It is expected to review anew all 13 proposals handed over to CUC since July of 1997 as well as to “establish a list of firms in a ‘competitive range,'” the statement said.

To ensure a fair deliberation, CUC had asked statement that the engineering firm had no role in the initial bidding of the power project and no current conflict of interest.

The deal with Burns & McDonnell, announced on Friday, ended more than four months of search for an independent firm that would help resolve dispute on the power project which has stalled in the last six months due to mounting protests.

“There is no specific time frame for the new round of evaluation,” CUC explained, “however, the utility requested that work be completed promptly as the island of Saipan faces a detrimental power shortage.”

Designed to address increasing power demand on Saipan by the end of the decade, the project has been held up by legal snag questioning the choice of Marubeni Corp. of Japan and its U.S. partner Sithe Energies, Inc. to build the plant.
Enron and a consortium of Alsons, Tomen, Singapore Power and Tan Holdings Corp. have lodged protests with the public auditor’s office alleging technical deficiencies in Marubeni-Sithe’s proposal as well as incompetence of an in-house selection committee that awarded the contract last June.

OPA has deferred ruling on their complaints pending result of the independent review which CUC hopes will clear doubts on their earlier decision and move ahead with the construction of the plant.

Touted to be the largest deal ever in the CNMI, the Saipan power plant is to be constructed through the build-operate-transfer scheme under a 25-year agreement.