Christie confirms state-owned Chinese company seeks BEC contract

Fri, Dec 6th 2013, 12:24 PM

Prime Minister Perry Christie has confirmed the involvement of a state-owned Chinese company in the Bahamas Electricity Corporation (BEC) reform process, but indicated that it is not yet clear if they will make it through to the next round.
Meanwhile, the prime minister revealed that he was set to participate in a meeting yesterday afternoon in which the question of who will advance to the next stage of the BEC request for proposal.
"We are discussing and I have a meeting this afternoon. We are down to short-listing. That is why I said 'yes' (to the company's involvement in the bidding process), but you may call a name and I say 'yes', but some questions are not relevant because they are short-listing down to a final few."
"So yes they applied, but yes, they may not be in it (anymore)," said Christie.
Christie spoke with Guardian Business yesterday shortly after it was revealed that sources close to the BEC reform process have indicated that the China State Construction and Engineering Corporation (CSCEC), the parent company of China Construction America, Baha Mar's general contractor, was among those companies bidding to take over BEC's generation responsibilities.
"I can confirm that they were one of the bidders," the prime minister.
On Thursday, Guardian Business revealed several sources close to the BEC reform process indicated that CSCEC was among a handful of companies bidding to take over the generation portion of BEC's current operations.
Others understood to be involved in bidding for generation responsibilities include Malaysia-based conglomerate Genting Group; Cayman-based Inter-Energy and Texas-based Caribbean Power Partners.
U.S.-based Pike, who was partnering with Grand Bahama-based Northern Bahamas Utilities (NBU), and North Carolina-based PowerSecure were understood seeking the transmission and distribution contract, however Guardian Business understands that Pike and NBU have now exited the process.
Information about those involved in the BEC reform RFP has been scant as all of the parties involved are bound by a non-disclosure clause in the terms of their involvement.
The process is being overseen by the government's advisors in the matter, KPMG Bahamas and DNV Keema, with these entities managing the bidding process and, in conjunction with legal advisors Hogan and Lovells, scrutinizing the proposals put forward by the companies on behalf of the government.
This process will ultimately result in the selection of a preferred bidder, or bidders, with whom the government will soon begin negotiations as it seeks to reduce the cost of electrical power.
The involvement of a Chinese state-owned company in the bid to take over one of The Bahamas' critical infrastructure assets, and the only provider of electricity, is likely to be of concern to some, in particular U.S. authorities, given previously expressed concerns on the part of the U.S. embassy in Nassau about Chinese involvement in the Bahamian economy.
Those fears were raised in confidential diplomatic cables released by Wikileaks in 2010.
At that time, a U.S. embassy official noted that the U.S. view was that, "the Chinese appear committed to establishing a firm financial hold on projects, such as Baha Mar, that will have a major impact on the Bahamian economy and leave the Government of the Commonwealth of The Bahamas indebted to Chinese interests for years to come."
Messages sent to local Chinese officials at the Chinese Embassy for comment on CSCEC's participation in the BEC RFP yesterday were not returned up to press time.
CSCEC is one of the world's largest general contractors, and primarily focuses on construction projects, with a focus on housing construction, international contracting, real estate development and investment.
According to CSCEC's website, the corporation is ranked the 3rd largest in the world and the 20th largest general contractor in terms of overseas sales.
Energy generation is a less significant component of the company's business, but its website notes that its involvement in this area is growing.
"In infrastructure development and construction, China Construction is the beginner, but the fastest-growing enterprise. It has successfully entered into the markets of railways, super-large bridges, highways and urban rail transportation. So far, the company has undertaken a number of infrastructure projects with extensive influence at home and abroad including railways, highways, bridges, tunnels, airports, ports, power plants, etc.," states the site.

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