What led to Karuma dam’s extension again?

Monday January 20 2020
prosper05pix

The Karuma Dam Spillway. Until recently, the contractor envisaged project completion for September 2020 but has now requested for an extension to November 2020. Photo by STEPHEN OTAGE

Water flows calmly through the tunnel buried 80 feet below the ground at Karuma dam. Here, young Ugandans are at work and attaining skills.

Works carry on almost as if sounds of the havoc raised by the in-charge are on mute.
But Karuma dam commissioning has been extended, yet again!

The paragon of architectural beauty, Karuma dam, will not be commissioned early this year as was earlier stated by the country’s electricity generator.

“At the moment, Karuma dam is at over 95 per cent overall progress. We have the hydro and electro mechanical parts in place but a lot of work still needs to be done with completion of the employer’s camp,” Mr Simon Kasyate, head of communications and corporate affairs, Uganda Electricity Generation Company Limited (UEGCL), says adding that land acquisition for transmission lines is still pending.

The over Shs6 trillion Karuma dam, according to UEGCL, will take on a new commissioning date of November 30.

“We have been informed of an extension of time which was as a result of discussions between government of Uganda and the contractor and the new extension time from the information we have is November 2020,” he says.

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First, the original completion date was December 16, 2018 then it became December 31, 2019.

Until recently, the contractor envisaged project completion for September 2020 but has now requested for an extension to November 2020.

UEGCL board chairperson, Ms Proscovia Margaret Njuki who led other board members through an inspection tour of the 600 megawatt dam said the extension is paramount if the Karuma is to be fit for purpose.

“As supervisors, we scrutinise in detail. Currently, we are looking at how to repair the spillway, it has been on and we have reported it before. So we are discussing with the contractor on the best way to do that. We have looked at the electrical mechanical installations, they have done a great job but there is still some maintaining that needs to be done,” she explains.

Explaining why the generator delayed to flag the glitches in works undertaken, Mr Kasyate said UEGCL has been sending reports about matters concerning the dam and this extension is testament to that.

Extension at no cost to Ugandans
In 2018, at the first request for extension by the contractor, UEGCL said the country would incur extra costs to keep the project consultants at the site.

Worth noting, UEGCL has now emphasized that Ugandans will not incur further costs due to extension of time for completion of the dam.

This follows a decision made during a December meeting held between Ministry of Energy and Mineral Development and Sinohydro Corporation Limited, the Engineering, Procurement and Construction (EPC) contractor.

According to documents, while the contractor demanded $166m as compensation for the extension on grounds that delays were caused by the ministry due to land acquisition challenges and change of prior approved drawings among others, government rejected the request.

“Compensation costs due to extension of time are unsubstantiated, not applicable and should therefore be dropped. For concurrence delays, the contractor has no right to claim time related costs. Changing of approved drawings is allowed as per the contract conditions if they are found to be defective, deficient…” government responded.

The parties later agreed to drop the compensation costs but maintained that all other claims submitted should be dealt with in accordance to provisions of the contract.

Other issues of contention discussed during the meeting involved overturning already approved drawings, project implementation schedule, handover of the remaining land on transmission lines to the contractor, mechanical concerns as well as remedy of defects at the dam.

Sino Hydro won’t repair defects
The ministry rejected Sino Hydro’s proposal to repair defects that do not affect operation and generation after wet commissioning of the dam and during the defects liability period, saying the contractor has had two years of extension time which should have been enough to perfect the dam.

Sino hydro during the meeting also requested government to provide security for already completed works to protect the structures from vandalism which the contractor says has greatly contributed to project delays.

However, government in response said responsibility and costs of securing the materials lies with the contractor until such a time that the project is completed, urging the company to make use of the project insurance policy.

Auditor General cautions UEGCL
Meanwhile, the Auditor General in 2019 had warned that the EPC contractor failed to meet different timelines which would cause delay of the completion of the project.

He also noted that community developed action plan activities such as construction of schools and health centres among others had not commenced in July due to lack of funding for land acquisition.

Failure to quickly attain land for the project, the Auditor General warned, could expose the country to additional costs in form of compensation to the contractor and increased commitment fees incurred at a rate of 0.25 per annum on the undrawn balance on the loan facility.

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