FILE PHOTO: Construction continues on the San Fernando to Point Fortin Highway in August 2021. –
THE Prime Minister said on Friday the commission of enquiry (CoE) into the acquisition of private lands to build the Solomon Hochoy Highway extension from San Fernando to Point Fortin will be expanded to include the grant of a $852 million waiver to bankrupt Brazilian construction firm Construtora OAS.
Dr Rowley said the OAS contract was mysteriously amended, under the former People’s Partnership government days, days before the 2015 general election.
He announced this change to the CoE, chaired by retired judge Justice Sebastien Ventour, in the House of Representatives.
In 2019, Minister in the Office of the Prime Minister Stuart Young had announced the CoE due to questions over $500 million spent on land acquisition. Last month, London arbitrators told Nidco to pay US$126 million in damages to OAS for terminating their contract when OAS had filed for bankruptcy in Brazil.
Rowley told MPs the $5.2 billion OAS contract was TT’s “single largest ever contract.”
He said by 2016 OAS had basically stopped all works.
“At that time abandoned workers were protesting daily, sub-contractors were claiming hundreds of millions of dollars being owed to them by an absent OAS, equipment was being seized, most of the expatriate OAS staff had left TT and no progress was being made by OAS on the highway construction.”
Rowley said the Government stepped in to pay desperate, abandoned workers.
The Prime Minister related the Government’s discovery of a secret amendment under the PP/UNC just 72 hours before the 2015 election, which exposed TT to huge potential liability by shifting control of insurance bond money from Nidco to OAS by removing clause 15.2 (e) of the Fidic Yellow Book contract.
He said when the PP/UNC came into office, OAS officials pursued the contract by flying to South Africa to meet a Cabinet minister during the FIFA World Cup.
Rowley said the $5.2 billion OAS contract exceeded the $3.6 billion engineer’s estimate, dubbing this, “the first salvo against the taxpayer.”
He recalled a rise in the standard advance payment to OAS from ten per cent ($428 million) to 20 per cent ($856 million.)
“All payments made to OAS for activities under the letter of intent, which totalled $236 million, should have been deducted from the advance payment. However, these sums were not deducted.
“So, even before construction began, the former government, who are now the Opposition, loosely facilitated OAS with over $1 billion of taxpayers’ monies.”
He said in 2015, while Nidco’s engineer advised it could terminate the contract owing to OAS filing for bankruptcy, Nidco removed clause 15.2 (e), letting OAS claim almost $1 billion in insurance money meant to protect the TT taxpayer.
“I have raised this question for seven years and never once was there any spokesperson of the UNC administration who saw it fit to respond, in any way.”
Rowley said after terminating the contract, UK court rulings let Nidco access US$139 million in advance payment and performance securities, but UK arbitrators had since directed TT to return $852 million. He said Nidco is appealing the arbitration award. The PM had questions to include in the CoE.
By what “process, advice and documentation” did OAS get was a $852 million waiver? Who authorized this and who carried it out? What was the specific purpose and benefit to be had?
What was the role of the Ministry of Works and Transport, Nidco, the consultant and the management?