BPA faulted over RM1.4bil supply base dock project award

KUALA LUMPUR: The Bintulu Port Authority (BPA) has granted a supply base dock project worth RM1.4bil to a construction company via direct negotiation without approval from the Finance Ministry.

A newly tabled second series of the Auditor-General’s Report 2016, stated that four of five procurements under the project were done through direct negotiation when it was supposed to be done through an open tender.

According to the report, the project also had not gone through detailed planning before it was awarded to contractor Muhibbah Viccana JV on Dec 16 last year.

The procurements, said the report, included the construction of the supply base dock project (RM1.24bil), consultation for the project (RM175.3mil), environmental monitoring, compliance reporting and coastal erosion monitoring (RM15.42mil) and consultancy, management and monitoring services (RM29.02mil).

“The audit did not find any evidence indicating that the BPA had applied for permission to execute procurements through direct negotiation from the ministry,” the report said.

The cost to appoint consulting firm EDP Group Consulting as the supply base project consultant at RM159.38mil, was also not in line with the decision of the board of directors, which had capped it at RM60mil.

The report also said that there were no letters of intent for all four procurements, apart from the absence of price negotiation.

“BPA’s failure to adhere to these price negotiation procedures exposes them to the risks of abuse of power and mismanagement.

“Without market research and cost estimates, BPA was not able to ensure that this project was the best value for money,” it said.

According to the report, BPA did not answer any of the issues raised by the auditors.

The Public Accounts Committee is expected to summon the BPA for an inquiry over issues surrounding its expenditure.