PETALING JAYA (April 7): The inexperience and lack of expertise of the contractors hired to helm the construction of the Paya Peda Dam in Terengganu had not only culminated in a flood two years ago but will also affect targeted increase of paddy yields in the district of Besut this year.
The Auditor General’s (AG’s) Report 2013 stated today that the Finance Ministry had hired water and steel pipes manufacturer JAKS Resources Bhd and Pembinaan Sujaman Sdn Bhd through a RM342.55 million contract via direct negotiation.
However, the AG found that not only did the contractors lack the experience needed in the construction of a dam with a hydro mechanical gate system, they had also flouted international guidelines, failed to submit preliminary drawings resulting in an incomplete submission for the project and made wrong calculations on components of the project.
They also had insufficient assets for construction, causing a delay in the completion of the project which was initially targeted to be completed within a timeframe beginning June 1, 2010 to November 30, 2013.
“For example for the month of July 2013, the total number of machines should be used in the construction of the Peda Dam is 215 units of machinery but the contractor only uses a total of 151 units of machinery alone,” the report stated.
“In the Audit’s opinion, this delay can be avoided if the contractor had been working to implement the project as specified in the contract.
“It could have also been avoided by the selection of competent contractors in terms of experience, knowledge, and sufficient resources in construction management, especially for large-scale projects requiring high technical expertise.”
The Paya Peda dam is located 1.5km upstream of Angga Barrage and 17km from Jerteh, Terengganu.
A total of 12:12 square km (16%) of a 77 square km catchment area has been used as water reservoirs.
According to the Final Design Report 2009, the dam is expected to save (reliable storage) of 220 million cubic metres of water and produce up to 1,120 million liters per day (MLD) to meet the water supply needs of agriculture, domestic and development in the Besut district until 2050.
“The objective of this project is for the construction of a dam to provide water to meet the Besut Irrigation Scheme in the North Terengganu Integrated Agricultural Development Area (IADA KETARA), increase the supply of water in the Besut district and a control structure to reduce flood risks downstream of the Besut river and other areas during the monsoon season,” the report stated.
Key requirements of project not met.
The audit found that weaknesses of the project include:
i. lack of compliance with the contract clauses such as the shortage of equipment utilised than specified in the contract which contributed to the delay in completion of the project and the appointment of a subcontractor without permission
i. lack of compliance with the contract clauses such as the shortage of equipment utilised than specified in the contract which contributed to the delay in completion of the project and the appointment of a subcontractor without permission
ii. improper payments of RM530,000 to a surveyor for work related to land surveying However, the Agriculture Ministry has taken steps to recover the amount overpaid. The company has returned a total of RM150, 000 and the balance will be paid in installments;
iii. selection of contractors who are not qualified / experienced had also contributed to the high number of Non-Compliance Reports;
iv. recommendations by the Environmental Impact Assessment (EIA) was not fully complied with, including for tests to be conducted to ascertain the existence of arsenic minerals, unsatisfactory management of oil waste and an Emergency Response Team was established at the beginning of the project; and
v. lack of engagement with local residents to address flooding.
The incompetence had resulted in a flood two years ago that caused 2,300 residents to be evacuated after the upstream coffer of the dam, or a section of the dam’s bank, collapsed after heavy rains.
National news agency Bernama had reported that the overflowing water submerged the whole area of Kampung Padang Bual up to the roofs of the residents’ houses.
According to the AG’s report, the temporary bank was constructed according to international standards of 1:25 years but the rains at that particular time had exceeded was extraordinary, which exceeded the 1:50 years mark.
The delay in the project will affect projected paddy cultivation conducted twice a year, therefore affecting increase of paddy yields and flood mitigation, the objectives of the project.
The contractors had also appointed 16 subcontractors without approval from the enforcement officer, resulting in 271 workers ranging from project engineers, supervisors, project managers, surveyors and technicians, chainmen, field assistant, machine operators, drivers and staff from 8 subcontractors working at site.
The contractors had also appointed 16 subcontractors without approval from the enforcement officer, resulting in 271 workers ranging from project engineers, supervisors, project managers, surveyors and technicians, chainmen, field assistant, machine operators, drivers and staff from 8 subcontractors working at site.
The Edge Financial Daily had reported in March 2010, that according to a local research house, JAKS would have to subcontract a large portion of civil works to more experienced contractors due to its lack of experience in dam construction.
The delay will cause the government an additional cost of consultancy totalling RM454, 899 per month or RM2.96 million, based on application letters dated May 30, 2013 for the period December 2013 to June 2014.
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