Bid irregularities scupper contract

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Posted June 18, 2019

Durban - The contract issued to the CMI Entateni Joint Venture in July 2018 to deepen, widen and lengthen the Durban Container Terminal’s North Quay (berths 203, 204 and 205) has been formally cancelled.

Contractors were already on site with work commencing in October last year, when Transnet responded to an unsolicited report from an entity called “Forensics for Justice”, alleging procurement irregularities on the project.

On November 20, Transnet issued a project manager instruction to the contractor to “stop all work”.

This was to afford Transnet time to conduct its own internal forensic investigation into the allegations.

On February 20, the contractor issued Transnet with a “notice of termination” as it was entitled to do in accordance with the contract.

Transnet said it was acting in the best interests of both parties, accepted the contractor’s notice of termination and issued CMI Emtateni JV a termination certificate on April 16.

In late May, Transnet disclosed that its internal forensic investigations were ongoing and were not yet complete.

It said it was “currently re-assessing a way forward on the main marine contract scope of works in order to minimise any further delays in realising the benefits of the project”.

The berth-deepening contract is aimed at enabling the Port of Durban to handle larger container ships at the country’s busiest container terminal.

After the widening and deepening of the port entrance channel to a depth of 16.5m some 10 years ago, Durban has had to handle an increasing number of much larger container ships diverted on to the South African trades by shipping lines “cascading” intermediate-size vessels of up to 14000 20-foot equivalent unit (TEU) capacity from the Asia-Europe or Asia-West Coast North America service to North-South and South-South services, as these were replaced with vessels of up to 20000 TEU.

These much larger container ships calling at Durban and most other South African ports are forced to arrive with less than full-capacity cargoes.