Billions paid for the scandal-ridden Kimwarer dam will go down the drain after President Uhuru Kenyatta ordered the cancellation of the project in Elgeyo Marakwet County.
This is after the project was found to be technically and financially not feasible by a technical committee Uhuru appointed to review it alongside the Arror dam following corruption claims that rocked the two projects. The team found both projects were overpriced.
However, Uhuru directed the immediate commencement of the implementation of the Arror multipurpose dam project with the new design components and cost rationalisation. It is set to cost Sh15.4 billion instead of the Sh28.3 billion.
Uhuru issued the directives at State House, Nairobi yesterday, when he received a report on Sh63 billion projects from the team he formed following the discovery of irregularities and improprieties surrounding the two infrastructure projects.
The Sh22.2 billion Kimwarer dam was found to have been overpriced and that the project is neither technically nor financially viable. This means that about Sh4 billion already paid to contractor - CMC Di Ravenna of Italy - may be lost.
Deputy President William Ruto had defended the project, refuting claims of fraud while insisting that only Sh7 billion had been paid and that all the payments had a bank guarantee.
Kerio Valley Development Authority (KVDA), which is implementing the projects, had indicated Sh7.6 billion was paid for the two dams. Some Sh4.2 billion was paid in December 2017 for Arror dam, while Sh3.4 billion was paid for Kimwarer dam in November 2018.
However, investigators handling the file insist that Sh20.9 billion has since been paid to the contractor for the two projects.
For instance, in the Arror dam case, detectives say, an advance payment of Sh4.5 billion was made. Another Sh6.1 billion was paid to an Italian insurance firm, SACE S.p.A, and a commitment fee of Sh490 million was also paid, making it a total of Sh11.1 billion.
For Kimwarer dam, the detectives established that Sh4.99 billion had been made as advance payment.
Another Sh3.5 billion was paid as a commitment fee, while the same Italian insurance company received Sh418 million, making it a total of Sh8.9 billion.
It’s the controversy that prompted the President to appoint the team chaired by Principal Secretary for Infrastructure Prof Paul Maringa, comprised of Quantity Surveyor Julius Matu, Eng Benjamin Mwangi and Eng John Muiruri to assess the viability of the two dam projects.
Already, Treasury Cabinet Secretary Henry Rotich, his PS Kamau Thuge, East Africa and Regional Development Susan Koech, ex-KVDA MD David Kimosop and 24 others, have been charged with fraud and corruption that Director of Public Prosecutions (DPP) Noordn Haji says led to loss of Sh19 billion.
A statement from State House last evening said that in the course of their assignment, the technical committee reviewed the designs, technical sustainability and financial proposals of both dams.
The committee established that no current reliable feasibility study had been conducted on the dam project.
The only feasibility study carried out on a similar project 28 years ago had revealed a geological fault across the 800-acre project area, which would have negative structural effects on the proposed dam.
The committee also established that Kimwarer project area is settled and would require compensation of displaced residents.
According to the technical design of the Kimwarer dam, the water supply mechanism would involve pumping, an aspect the committee found to be unsustainable in terms of operations and maintenance costs.
Further, the committee established that the pumping would make the project financially-unsustainable in the long run.
On the second project, after a detailed technical review, the committee was satisfied that the Arror multipurpose dam project is economically-viable but noted that it was overpriced.
As such, the committee recommended to the President a cost rationalisation plan that will ensure the project is implemented cost-effectively without affecting its performance and output.
As part of the cost rationalisation plan, the committee has prepared a new Bills of Quantities (BQ) for a modified dam with its height scaled down to 60 metres from the original design height of 96 metres which was found to be unviable.
The optimised dam will be technically viable since it will only require about 250 acres of land at a cost Sh15.4 billion with power and Sh13.1 billion without power. The dam was previously estimated to cost Sh28.3 billion.
This means the tax payer will be saved Sh13 billion.
But yesterday evening, Elgeyo Marakwet Senator Kipchumba Murkomen in whose county the projects are situated, took a swipe at the technical committee, saying cancellation of Kimwarer and restructuring of Arror dam doesn’t surprise him.
“The committee didn’t consult nor did it carry out public participation. Elgeyo Marakwet has been denied rightful share of national projects in deliberate act of discrimination.They would rather default and pay contractors billions for breach of contract than to see our people benefit,” he wrote on his Twitter account.
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