The Oil and Gas Development Company (OGDCL) is all set to open up the new Pandora's box by following a faulty process in award of a $300 to 400 million Uch development project II that may end up this key project of much-needed oil and gas production in litigation.
Sources said the entire process being followed by OGDC, a public sector giant, for Uch development project II is based on a faulty formula which cannot be justified through any logic and in case of moving the court of law by any of the parties in the run the concerned authorities will not be in a position to defend as if what was the logic of dividing the numbers into 70 and 30 marks for technical and commercial evaluation for award of contract for this mega project.
According to the tender document, OGDC has divided technical evaluation into eight clauses/ areas. Each clause/ area possesses its own merit and anybody can be given point at any level of one's choice. Evaluator can judge and give marks to a party he or she likes to give undue favour and put other bidders at complete disadvantage.
There is a serious question as if what will be the basis of marking for procurement, strategy, capability and adherence to specifications for one of 8 areas, which carries 8 marks. From top to bottom, all 8 areas marked for 70 points for a huge project of 300 to 400 million dollars could be misused by evaluators to favour a hand-picked from the bidders.
Interestingly, each single number can add millions of dollars to the cost of the project and faulty technical procedure can simply result in award of contract at 30 to 40 percent higher cost. It would also negate Public Procurement Regulatory Authority (PPRA) Rules clause (4) which said "The principle of procurement-procuring agency like OGDC while engaging in procurement shall ensure that procurements are conducted in fair and transparent manners.
The objective of procurement to bring value of money to the agency and the procurement process is efficient and economical. One an hardly believe what allures OGDC to go for such a faulty and prone to litigation procedure for award of the contract for a big project like Uch II when PPRA rules stress for an economical, efficient and transparent procurement procedure. .
The model being followed by OGDC is not practicable anywhere in the world. One can question as to why OGDC like public sector company is not interested in following a transparent procedure to make it economical for award of contracts for its development projects.
For ambiguous tender procedure, OGDC had to scrap tender for Uch development project II earlier in 2009 and now for the second time the management seems inclined to make faulty procedure a basis for award of contact to some selected parties/ groups and invite unending litigation for this key project.
OGDC's at least five major development projects including Sanjoro KPD and Qadirpur compression projects had been in litigation for years resulting in depriving the country of promising new discoveries to help the government mitigate on-going gas crisis exactly at a very crucial juncture when the national economy needs key inputs like gas to pull it out of bad days.
The issue of litigation of OGDC's projects and its subsequent impact on gas production has been noticed time and again and efforts are being made at the highest level to streamline the system and bring halted oil and gas projects on line to get more production in the near future. At the same time OGDC's faulty formula for evaluation of bids raises serious questions.
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