— AG threatens legal action, says company must deliver in accordance with contract

PRESSURE continues to mount on the China Harbour Engineering Company (CHEC) to deliver the Cheddi Jagan International Airport (CJIA) expansion project in accordance with the agreed terms outlined in the initial contract, as the government has halted all payments and the next resort will be to take legal action.
The CJIA expansion project has been subjected to criticisms from the new government since it took office in August 2020. President Irfaan Ali and other officials of the government have said that Guyana will not be tolerant of unsatisfactory work, specifying that the project will only be accepted if it is done in accordance with the “original contract” that was signed in 2011.

When the A Partnership for National Unity + Alliance For Change (APNU+AFC) coalition assumed office in May 2015, the project, which had been slated for a December 2017 completion, was halted for review.
Following that review, the scope of work was adjusted, several changes were made, and a new deadline was set for December 2018. But the new government is adamant that the conditions agreed to in 2011 must be delivered, or legal action will be taken against CHEC.
In a letter to the company, dated December 8, 2020, Attorney-General Anil Nandlall said: “Your company has failed to satisfy the employer’s requirement, contractor’s proposal and schedules, and all works necessary for the stability, safe and proper operation and completion of the whole works.”
The Attorney-General said the Ministry of Public Works entered into a “Fixed Priced Contract” to the tune of US$138 million to CHEC for the extension of the CJIA on November 11, 2011, and its subsequent addenda on September 15, 2014, July 28, 2015, March 15, 2017, December 12, 2017, and November 10, 2018 collectively forming the existing contract.

“In accordance with the terms of the underlying contract, CHEC Ltd’s contractual obligations are to carry out the planning, design and construction of the Extension of the CJIA, which is listed as one of the top-priority development projects of Guyana,” Nandlall reasoned.
The project includes the construction of a New Terminal Building (NTB), and the extension of the existing main runway to allow for Code E Aircraft operations at the CJIA. This project, when completed, is expected to attract more international airlines and travellers, to promote tourism and to provide economic development.
“Pursuant to the contractual obligations of the underlying contract, your company failed to deliver works that shall be fit for the purposes for which the works are intended, as defined in the contract after nine years of the implementation of the extension project,” said the Attorney- General.
The company, he argued, has failed to uphold critical contractual elements, which include remedying all defective items for the entire project, even after a notice was issued to correct the defective work.

Nandlall said, too, that the company also failed to achieve substantial completion as per several clauses in the contract, and to complete the work within the given timeframe. “Our dissatisfaction with your performance and your breach of contract has already been reported by our Ministry of Public Works to the Chief Executive Officers of the Export-Import Bank of China, and by our Prime Minister to Mr. Wang Tongzhou, Chairman of China Communications Construction Group, your parent company,” said the Attorney- General.
The government has also rejected all and any unilateral demand for additional payments, and has reiterated its ultimatum for specific performance as outlined in the contract.

“Any failure to comply with the aforementioned demand will result in my advising my client to seek legal remedies, and to forebear from any engagements with your company in the future,” the Attorney-General asserted.
On December 2, 2020, it was reported that the government received a revised work plan for the project, but the resubmitted document, prepared by CHEC, has come in for much criticism from the Minister of Public Works, Bishop Juan Edghill.
According to Minister Edghill, the revised work plan has failed to once again address a number of the concerns highlighted by the government.
Prior to the adjustments, the original project specified the extension of the runway from 7,500 to 10,800 feet, so as to accommodate the Boeing 747-400 aircraft. It also

provided for the construction of eight passenger boarding bridges. This required the demolition of the existing terminal building, and the construction of a new one capable of accommodating the eight structures. The revised scope of work done by the previous Coalition Government facilitated the refurbishing of the terminal building instead of its demolition. This meant that only four air bridges could be accommodated.
While the recently resubmitted work plan did include provisions for the eight air bridges, there were still a number of unresolved issues, including the construction of office spaces, a gallery and waiting area. Over the past nine years, the project has also encountered a plethora of other problems, including an inadequate and malfunctioning sewerage system.