222 executive borad meeting of nha

8/9/2019 222 Executive Borad Meeting of NHA

http://slidepdf.com/reader/full/222-executive-borad-meeting-of-nha 1/52

222nd Meeting, October 16, 2012, Islamabad

NHA Executive Board’s Confirmed Minutes

1

NATIONAL HIGHWAY AUTHORITY

Secretariat Section

CONFIRMED MINUTES

Subject:- 222nd Meeting of the NHA Executive Board Held on

October 16, 2012 at Islamabad

1. Introduction

1.1. The 222nd meeting of the Executive Board of the National

Highway Authority was held at 1130 hours on Oct 16, 2012 at the

NHA Head Office Auditorium, Islamabad. The Chairman NHA Mr

Muhammad Javaid Iqbal Awan presided.

1.2. All Members attended. List of participants is at Annex-A.

1.3. The meeting commenced with recitation of verses from the

Holy Quran and Urdu translation.

FORMAL BOARD PROCEEDINGS

2. Agenda Items

2.1. The Secretary NHA stated that 12 x working papers were

distributed in two volumes on Oct 10 & 12, 2012 respectively.

Subject-wise distribution is as follows:-

Item Noa. Minutes 1

b. Award of Works 3

c. Motorway (M-2) Overlay (BOT) 1

d. Contractual Matter 1

e. Consultancy Issues 3

f. NHA Budget 2012-13 1

g. NHF Matter (Withdrawn) 1

h. Modified PC-I 1

Total 12





2

2.2. The Secy NHA added that the Member (Planning) has

forwarded a working paper on “Award of Works (FERP): Construction

of Bridge Across Vadoor Nullah at km 96 - 97 (N-70) (NCB-S-12)” also

for consideration as a tabled agenda item stating that this matter is

of high importance as the road users are facing extremeinconvenience at this site as the traffic is moving through the Nullah

Bed on a temporary diversion for the past quite some time. Similarly,

the Chairman has directed placement of a working paper on

“Upgradation of Misc Posts in BS-1 to 16 of NHA Employees” as a

tabled agenda item, if permitted by the Board Members.

3. Agenda Item 1Confirmation of Minutes - 221st Meeting of the

Executive Board Held on Sep 25, 2012

3.1. The Secretary NHA solicited confirmation of minutes of

the 221st Executive Board meeting held on Sep 25, 2012 conveying

that the same were circulated on Oct 12, 2012 and that certain

written comments / observations have been received only from the

Chief (T&C), Planning Commission.

3.2. Minutes were confirmed with the suggested amendments.

Decision

3.3. The Executive Board confirmed minutes of 221st meeting

held on Sep 25, 2012 with following amendments:-

a. In Agenda Item 4 titled “Award of Works: FERP/

ADB/NCB Rehab of Mansehra- Naran- Jhalkhad-

Chillas (N-15, Pack-I): NCB-N-04 Basian-Balakot

(Km 34 - 38),” the ECNEC decision given under

Para 7.2(a) is replaced with the following:-

“The ECNEC considered the summary dated May 4,

2011 submitted by the Planning Commission titled

“Rehabilitation of National Highway Network

Damaged due to Unprecedented Monsoon Rains &

Flash Floods 2010” and approved the project, in

principle, and authorized Dy Chairman Planning

Commission/Chairman CDWP to approve the

reviewed scope and cost of project duly vetted by the high level Committee constituted by the CDWP.”





3

b. In Agenda Item 4 titled “Award of Works: FERP/

ADB/NCB Rehab of Mansehra- Naran- Jhalkhad-


(Km 34 - 38),” the last sentence in Para 7.16 isreplaced with the following:-

“However, he has now learnt that the cost has

increased from Rs 23 billion to Rs 32 billion,

therefore, owing to major increase in scope and cost,

the amended PC-I will again be considered by the

Planning Commission.”

c. In Agenda Item 4 titled “Award of Works: FERP/ADB/NCB Rehab of Mansehra- Naran- Jhalkhad-


(Km 34 - 38),” the following words are added at the

end of Para 7.22 under the head Decision:-

“subject to completion of codal formalities”

d. In Agenda Item 5 titled “FERP/ADB/NCB Rehab of

Mansehra - Naran - Jhalkhad - Chillas Road (N-15,

Pack-II): NCB-N-05 Mahandri - Naran (Km 89 to

119),” the ECNEC decision given under Para 8.2(a)

is replaced with the decision reproduced against “a”

above.

e. In Agenda Item 6 titled “Addendum 4 of M/s LRA

Group: Construction Supervision Consultants for

Gwadar - Turbat - Hoshab Road (M-8),” the existing

Para 9.14 is replaced as follows:-

“The Chief (T&C) remarked that while attending

meetings concerning review of the progress of

Balochistan projects with high level officials of

Government of Balochistan, an impression is

conveyed in such a manner that security issue is not

as such as it is portrayed.”





4

f. In Additional Agenda Item I titled “Addendum 3 of

M/s EA Consulting (Pvt) Ltd Construction

Supervision Consultants for Improvement of Inner

City Ring Road Project, Multan,” the following

sentence is added at the end of Para 18.9:-

“As such, the Board’s earlier decision needs to be

reviewed, before the instant proposal is considered.”

Action By : Secretary NHA

4. Agenda Item 2

Award of Work: Construction of Flood Protection

Bund Towards Garh Maharaja Side at Sultan BahooBridge Across River Chenab Linking Shorkot & Garh

Maharaja

4.1. Introduction of the Bridge Project.

a. NHA has undertaken the subject bridge under the

PM’s Directive to provide a road link across River

Chenab between Shorkot-Garh Maharaja. Presently,

traffic has to make long detours for crossing the river

either at Trimmu Headwork or at Muzaffargarh.

b. Bridge will facilitate traffic from Leiah, Bhakkar in

west and Jhang, TT Singh and Faisalabad in east. It

will reduce distance/ travel time and fulfil a genuine

and age old requirement and boost economic growth.

4.2. Current Status of Construction Packages.

I. Contract for Main Bridge was awarded to M/s Sh

Abdul Razzaq & Co- Mishal Sania (JV) for Rs 770.543

million in Jun-2010. Progress is 61.68%.

II. Contract for approach road (Garh Maharaja), drainage &

erosion works was awarded to M/s Hidayat Ullah

Khan & Co for Rs 570.118 million in Sep-2010.

Progress is 42.04%.





5

III. Contract for 3.88 km approach road & drainage/

erosion works awarded to M/s FE & HNAC (JV) for

Rs 572.110 million in Sep-2011. Progress is 20.05%.

Note.Tendered cost of the packages is Rs 1912.771 M.

4.3. Hydraulic Study.

a. Due to above project, the need for flood protection

works emerged at the “Bridge” site and in vicinity.

b. Hydraulic study concluded that heading up of flood

water on Bridge upstream will create extra head of 6

feet above DWL (Design Water Level) which may overtopthe existing flood bund in Shorkot and badly damage

area on the right (Garh Maharaja) side where no flood

bund exists.

4.4. Protection Works. Following protection works were

decided to be carried out by selecting a new contractor through open

competitive bidding with shortest possible process time:-

a. Construction of protection bund Garh Maharaja side

(approx length 9.754 km).

b. Construction / raising of protection bund Shorkot

side (approx length 4.954 km).

4.5. Scope of Work. This working paper deals only with the

works at Para-4.4(a) above. Works include formation of embankment

for construction of flood protection bund from borrow excavation in

common material including clearing of site, compaction of natural

ground and levelling / dressing of protection bund.

4.6. Source of Funding / PC-I.

a. PC-I of Rs 1602.878 million for Sultan Bahoo Bridge

Project was approved by ECNEC on Jan 21, 2010.

b. Cost of protection works is being included in the

revised PC-I presently in process.





6

c. PSDP allocation for FY 2012-13 for Sultan Bahoo

Bridge Project is Rs 150 million.

4.7. Engineer’s Estimate.

a. Rs 172,402,485/- (CSR-2009, District Jhang).

b. Rs 188,091,111/- (CSR-2009 + 9.1%, District Jhang).

4.8. Tendering Process.

a. Notice inviting bids on single stage two envelope

basis was published in press & uploaded on NHA &

PPRA websites on Apr 16, 2012. Pre-bid meeting was

held on Jun 21, 2012.

b. Seventeen firms (17) purchased bidding documents

and two downloaded the same from NHA website.

c. On the scheduled date viz Jun 29, 2012 twelve (12)

firms submitted Technical (Envelope-A) & Financial

(Envelope-B) bids within the given time:-

Messers’

i. NK & Company

ii. Saadullah Khan & Brothers (SKB)

iii. Ch Abdul Latif & Sons

iv. M Abrar Malik & Co

v. Hayat Ali & Co (Hayat)

vi. Sarwar & Co (Pvt) Ltd

vii. Astron Construction Co (Pvt) Ltd

viii. Sachal (JV) Techno Time Construction

(Sachal (JV) TTC)

ix. Chaudhry Construction Co

x. RMC Construction Company

xi. Abdullah Khan & Co

xii. AM Construction Company (AMCC)

d. Technical Proposals were opened and evaluated by

the Committee constituted in accordance with NHA

Code. Four bidders were recommended for opening

of Financial Bids.





7

4.9. Financial Proposals Opened / Announced on Jul 2, 2012.

Messers’ Bid (Rs) Final Bid (Rs)a. Sachal (JV) TTC 146,576,435 146,576,435

b. SKB 151,581,484 151,581,484

c. Hayat 201,710,625 201,710,625

d. AMCC 257,502,621 239,477,436 *

* Rebate/premium Rs 18,025,183/=.

4.10. Bid Securities. NHA Accounts Section has confirmed

acceptability of the bid security of all the bidders.

4.11. Summary. The summary of evaluation tabulated below

indicates comparative position vis-à-vis the estimated cost of Rs

188,091,111/- (CSR-2009+ 9.1%%, District Jhang):-

Lowest

RankingContractor (M/s)

Corrected

Bid (Rs)Variation

1st Sachal (JV) TTC 146,576,435 (-)22.07%

2nd SKB 151,581,484 (-)19.41%

3rd Hayat 201,710,625 +7.2%

4th AMCC 239,477,438 +27.3%

4.12. Recommendation. The Tender Acceptance Committee has

recommended award of works in question to the 1st lowest evaluated

bidder ie M/s Sachal (JV) TTC for Rs 146,576,435/- at (-)22.07% the

estimated cost.

Board’s Deliberations

4.13. The Member (Planning) presented details. The GM (P&CA)

& GM (Design-1) were also present.

4.14. The Board Members made the following observations:-

a. Since the cost of protection works was not included

in the approved PC-I, how can the works be awarded

without seeking approval of fresh PC-I? (Chief NTRC)





8

b. Original PC-I was approved as far back as in Jan-

2010, why NHA has not processed the revised PC-I

despite passage of considerable time? (Chief T&C)

c. It appears desirable to seek approval of revised PC-I

in the first instance. (JS-1 MoC)

d. Would it be possible for the contractor to deliver the

project of prescribed specifications at 22.07% below

the estimated cost? (Chief T&C)

e. What is the current financial progress of the three

ongoing packages and whether the expenditure so farincurred is within the 15% limit of the approved PC-I

cost as the three original packages were awarded at a

cost higher than the approved PC-I? (Chief T&C)

f. Why protection bund is proposed to be constructed

only on Garh Maharaja Side & why raising of bund

on Shorkot Side has not been proposed

simultaneously? Prudence demand execution of such

critical activity in totality. (Chief T&C)

g. Processing of PC-Is of major bridge projects and also

undertaking works without Hydraulic Model Study is

an undesirable proposition. Now that Hydraulic

Model Study for the subject bridge has been done it

may be seen whether the bridge parameters require

any revision. (Chief T&C)

h. Why following clause was included in the eligibility

criteria as it could give a clue to the prospective

bidders about the likely cost of the project and also it

needs to be clarified if this case is an exception or

incorporation of such a clause is a regular feature:-

“Completion certificate of at least one project of similar

nature with a value of minimum Rs 141 million during

the last five years.” (Chief T&C)





9

4.15. The following clarifications were rendered:-

a. Original PC-I was prepared without hydraulic model

study based on tentative design, therefore, cost of protection works was not included therein.

b. Original approved PC-I cost is Rs 1602.878 million

and expenditure so far incurred on 3 x ongoing

packages is Rs 829.657 million (Annex-B):-

Pack Project Rs in M

I. Main Bridge 475.271

II. Approach Road (Garh Maharaja) 239.678

III. Approach Road (Shorkot) 114.708

Total 829.657

c. Since the above amount is substantially less than

approved PC-I cost, the proposed river training works

may be allowed to be awarded. Revised PC-I based on

hydraulic model study and tendered cost is under

preparation and it will include all relevant costs.

d. Processing of revised PC-I got delayed because of

superfloods-2010 and time consumed in hydraulic

model study. It is assured that the revised PC-I will

be processed at priority within 60 days.

e. Careful rate analysis of the lowest evaluated bid was

carried out. The only major task is earthwork and

compaction level required is also less than 90% andthe contractor should be able to deliver protection

bund of the required specifications despite the bid

being substantially lower than the estimated cost.

f. Construction of flood protection bund towards Garh

Maharaja Side is of critical importance to save this

town from aggravated flooding caused due to bridge

construction. Time is of essence, as this task is

proposed to be completed within the next 5-6 monthsie before the next flood season.





10

g. Flood protection bund on Shorkot Side already exists

and only its height is needed to be increased by

Punjab Irrigation Deptt (PID). Cost of raising of this

bund will be added to revised PC-I in consultationwith PID for expeditious completion of this task.

h. This project was entrusted to NHA as per a policy

decision of Inter-Provincial Coordination Committee

under which all road infrastructure development

projects funded through PSDP were to be executed

by NHA and simultaneously a suitable allocation was

also made in NHA’s PSDP 2009-10.

i. Because of political importance, commencement of

bridges is accorded priority by the government and

the related river training works, etc, are undertaken

after model study; which consumes considerable

time. Nevertheless, the observation regarding prior

model study has been noted for compliance in future.

j. The clause seeking completion certificate of at least

one project of similar nature with a value of around

80% of the estimated cost is included in the eligibility

criteria of every procurement proceedings and this

case was not an exception. This clause is also

present in the ADB eligibility criteria.

4.16. Matter was discussed and cleared by the Members.

Decision

4.17. The Executive Board approved award of work for

“Construction of Flood Protection Bund towards Garh Maharaja side

at Sultan Bahoo Bridge Across River Chenab Linking Shorkot & Garh

Maharaja” to the 1st lowest evaluated bidder ie M/s Sachal (JV) TTC

at the evaluated bid price of Rs 146,576,435/= (Rupees one hundred &

forty six million, five hundred & seventy six thousand, four hundred & thirty five)

only; which is (-)22.07% from updated estimate of Rs

188,091,111/=(CSR-2009+9.1 %, District Jhang).





11

4.18. The Board directed NHA to:-

a. Expedite processing of revised PC-I for Shorkot -

Garh Maharaja Bridge Project within 60 days.

b. Include cost of raising of Shorkot Side flood

protection bund in the revised PC-I.

c. Ensure that all major bridge construction projects

are undertaken after Hydraulic Model Study.

Action By : Member (Planning)

5. Agenda Item 3

Award of Works: Widening & Improvement of Bosan

Road, Multan Contract-2 (Package-II) Construction of

Right Turn Flyover at Chungi No 6

Introduction - Working Paper

5.1. Introduction. Bosan Road is one of the busiest roads of

Multan City. The GoP tasked NHA to widen & improve this road (7.5

km) from Chungi No 9 to BZU (Bahauddin Zakariya University) including

construction of 2-lane flyovers for right turns at Golbagh Chowk &

Chungi No 6 and a 2-lane flyover from Chungi No 6 to Northern

Bypass Chowk.

5.2. PC-I / Funding.

a. PC-I of this PSDP funded project of Rs 4,570.022

million was approved by ECNEC on Jan 21, 2010.

b. PSDP allocation (2012-13) is Rs 750 million.

5.3. Construction Packages.

IA. Road from Chungi No 9 to BZU (RD 00+000 to RD 03+450).

IB. Road from Chungi No 9 to BZU (RD 03+450 to RD 07+520).

II. 2-Lane Flyovers for Right Turns (Golbagh & Chungi No 6).





12

5.4. Package-wise Progress.

IA. Contract awarded to M/s Khalid Rauf & Co for Rs460.8168 million in Apr-2011. Progress is 49%.

IB. Contract awarded to FWO for Rs 530.6349 million

in Mar-2011. Progress is 49%.

II. Works are now proposed to be awarded.

5.5. Scope of Work (Pack-II).

a. Project entails construction of flyover bridge,

retaining walls, earth embankment, pavement

structure, drainage and protection works, traffic

control devices and electrification works.

b. Pavement structure at different locations comprises

asphaltic concrete wearing course, asphaltic base

course, aggregate base course and sub-base. The

thickness of each layer varies on different road

sections.

5.6. Engineer’s Estimate. Rs 179,329,439/= (CSR-2009+9.1%,

Multan).


a. Procurement process was initiated by advertising

“Invitation for Bids” on “Single-Stage-Two-Envelope”

basis in national newspapers and through display on

NHA & PPRA websites.

b. Firms registered with PEC in Category C-3 or above

with specialization in CE-01 & 02 were eligible for

issuance of bidding documents; purchased by

thirteen (13) firms:-





13

Messers’

i. Niaz Muhammad Khan & Brothers (Niaz)

ii. RMC Construction Company (RMCC)

iii. Al-Mehran Builders Pak (Pvt) Ltd

iv. Ch Abdul Latif & Sons (Pvt) Ltd

v. Chaudhry Construction Company

vi. Ghulam Rasool & Co

vii. Hakas (Pvt) Ltd

viii. Kundi Development Corporation

ix. M Ibrar Malik & Co (AMC)

x. Mishal Sania (Pvt Ltd

xi. Mohandisin-e-Masud

xii. Sh Iqbal Akhtar & Co (Pvt) Ltd

xiii. Wajid Iqbal & Co

c. Pre-bid meeting was held on May 30, 2012.

d. On the scheduled date viz Jun 6, 2012, only four

(04) firms listed at Sl “i to iv” above submitted

technical (envelope-A) and financial (envelope-B) bids

within the scheduled time.

e. Technical bids were opened by Bid Opening &

Evaluation (BO&E) Committee constituted in

accordance with NHA Code. After detailed evaluation,the firms at Sl “i & ii” above were recommended for

opening of financial bids.

5.8. Financial Evaluation. Financial proposals were opened on

Jun 26,2012.Following result was announced:-

Messers’ Quoted Bid (Rs) Final Bid (Rs)

a. RMCC 231,389,017 214,214,551*

b. Niaz 269,149,055 269,149,055

* 5% rebate on Bills No 1 to 6.

5.9. Arithmetic Correction. The final bid amount of the lowest

bidder M/s RMCC emerged as Rs 220,115,707/= after application of

arithmetic checks in the light of IB (Instructions to bidders) Clauses 27 &

28. This amount was duly accepted by the BO&E Committee.

5.10. Summary. The summary of evaluation tabulated below

indicates comparative position vis-à-vis estimate of Rs 179,329,439(CSR-2009+ 9.1%, District Multan):-





14

LowestRanking

Contractor(M/s)

AnnouncedBid (Rs)

CorrectedBid (Rs)

Variation

1st RMCC 214,214,551 220,115,707 +22.74%

2nd Niaz 269,149,055 269,149,055 +50.09%


recommended award of works in question to the 1st lowest evaluated

bidder M/s RMCC at the corrected bid price of Rs 220,115,707/=.




5.13. On an observation by the Chief (NTRC), the GM (Design-1)confirmed that the works now proposed to be awarded are included in

the original package of Bosan Road Multan Project. However, the

Golbagh Flyover has been dropped.

5.14. The Chief (T&C) observed that the expenditure so far

incurred on Bosan Road Multan Project should have been indicated to

assess the need for PC-I revision. The GM (Design-1) clarified that this

project is located in urban area and the major cost component of the

PC-I was dedicated to land / RoW acquisition. Nevertheless, the up-to-date expenditure will be reflected in the minutes.

5.15. Note. An expenditure of Rs 2983 million has so far been

incurred on the Bosan Road Multan Project. It includes Rs 2397.876

million on land acquisition and utilities removal/relocation (Annex-C).


Decision

5.17. The Executive Board approved award of works for

“Widening & Improvement of Bosan Road, Multan-Contract-2 (Pack-II)

- Construction of Right Turn Flyover at Chungi No 6” to the 1st lowest

evaluated bidder M/s RMC Construction Company at the corrected

bid price of Rs 220,115,707/- (Rupees two hundred and twenty million, one

hundred & fifteen thousand, seven hundred & seven) only; which is +22.74%

the Engineer’s Estimate of Rs 179,329,439/= (CSR-2009 + 9.1%).






15

6. Agenda Item 4

Award of Works Under Flood Emergency

Reconstruction Project (FERP) : NCB-N-06 Flood

Damaged of Chakdara - Kalam Road (N-95) Package-I:

Fatehpur to Madyan (Km 82+000 to 89+700)


6.1. ADB Loan / Scope of Work.

a. Pakistan has received a loan (PAK 2742) from the

Asian Development Bank (ADB) towards the cost of

Flood Emergency Reconstruction Project (FERP).

b. Subject project ie NCB-N-06 Pack-I, Rehab of

Chakdara - Kalam Road (N-95): Fatehpur - Madyan

(km 82+000 to 89+700) is included in Phase-I of FERP.

NCB: National Competitive Bidding

6.2. Global PC-I.

a. Global PC-I of FERP based on DNA (Damage Need

Assessment) study conducted by NESPAK was

presented in ECNEC meeting held on May 26, 2011.

The ECNEC approved the PC-I, in principle, with the

following instructions:-

“The ECNEC considered the summary dated May 4, 2011

submitted by the Planning Commission titled “Rehabilitation of

National Highway Network Damaged due to Unprecedented

Monsoon Rains & Flash Floods 2010” and approved the project,

in principle, and authorized Dy Chairman Planning Commission/

Chairman CDWP to approve the reviewed scope and cost of

project duly vetted by the high level Committee constituted by the

CDWP.”

b. Revised PC-I is under preparation and included in

the deliverables of design consultants.

6.3. Engineer’s Estimate. Rs 806,795,292/= (CSR 2009+9.1%).





16


a. NHA and ADB agreed that the procurement of

subject works shall be made on Single-Stage-Two-Envelopes Basis for civil works in accordance with

ADB’s guidelines.

b. Escalation shall not be applicable on contracts of

12 months or less duration. Being 12 months

project, escalation is not applicable in this case.

c. Advertisement for Invitation of Bids (IFB) was

published in the press and displayed on NHA andPPRA websites on May 24, 2012. Bid documents

were procured by sixteen (16) eligible firms

individually or as JV.

d. Six (6) firms submitted technical and financial bids

on the due date viz Jun 13, 2012:-

Messers’ Legend

i. Zahir Khan & Brothers (JV) –Techno Time ZKB (JV) TT ii. Frontier Works Organization FWO

iii. Ch Abdul Latif & Sons (Pvt) Ltd CALSON

iv. Khattak Allied Construction Company Khattak

v. National Logistics Cell NLC

vi. Ghulam Muhammad Khan & Company GMK & Coy

6.5. Technical Evaluation.

a. Technical bids were opened on Jun 13, 2012 by the

Bid Opening & Evaluation (BO&E) Committee in thepresence of Reps of bidders. Price bids were kept

unopened and sealed in safe custody.

b. Technical bids were evaluated in accordance with

qualification criteria stipulated in bid documents.

Bids at sl “v” & “vi” were evaluated as “unqualified.”

c. Technical Bid Evaluation Report was approved by

ADB on Jun 27, 2012.





17

6.6. Financial Bid Evaluation.

a. Financial bids were opened on Jul 2, 2012 in the

presence of BO&E Committee. Quoted/announcedbid prices were as summarized below :-

Bidder (M/s) Rupees

i. ZKB (JV) TT 912,455,000

ii. Khattak 1,089,135,000

iii. CALSON 1,266,433,000

iv. FWO 1,376,880,859

b. Bids were evaluated as per ADB’s standardprocedures. Only one typographic / arithmetic error

was found in the bid of M/s Khattak.

6.7. Summary. Summarized comparison vis-à-vis estimated

cost of Rs 806.795 million (CSR 2009 + 9.1%) is as under:-

6.8. ADB’s Concurrence. The Priced Bid Evaluation Report

was forwarded to ADB for review/concurrence. The ADB issued NOC

dated Aug 17, 2012 for award of works to M/s ZKB (JV) TT.

6.9. Recommendation. The Tender acceptance Committee has

recommended award of works is question to M/s ZKB (JV) TT at the

quoted / evaluated bid amount of Rs 912,455,000/=.

6.10. LoA. After seeking anticipatory approval of Chairman

NHA, LoA has been issued owing to emergency nature of work.




Rank Consultant (M/s) Submitted (Rs) Corrected (Rs) Variation

1st ZKB (JV) TT 912,455,000 912,455,000 +13.10%

2nd Khattak 1,089,135,000 1,096,100,000 +35.86%

3rd CALSON 1,266,433,000 1,266,433,000 +56.97%

4th FWO 1,376,880,859 1,376,880,859 +62.36%





18

6.12. On an observation by the VP-NESPAK, it was clarified that

the NLC was disqualified because of the instructions issued by the

MoC that “no work should be awarded to NLC on any NHA project tillthe inquiry on collapse of Shershah Bridge is finalized.” However, the

Executive Board (219th meeting of Jul 24, 2012) accorded its no objection

for pre-qualification of NLC for award of construction projects by NHA

and for works tendered subsequent to this decision NLC is free to

participate.

6.13. The VP-NESPAK further observed that this contract being

of 12 months duration escalation will not be applicable. However, past

experience reveals that most of the projects get delayed because of onereason or the other. Therefore, as pointed out by him during the last

Board meeting also, he would suggest that in case the project goes

beyond 12 months, and escalation is ultimately payable, it should be

ensured that escalation is not allowed on works completed within first

12 months and a clause to this effect may be added to the contract.

6.14. The Member (Planning) clarified that the subject contract

is an item based and not EPC (Engineering-Procurement-Construction)

contract and inclusion of the proposed clause in the agreement will

attract various complications and also ADB’s objection. Nevertheless,

the observation has been noted and will be complied with. Alongside,

inclusion of such a clause in future contracts would be analyzed.

6.15. The Chief (T&C) pointed out that NHA has yet to obtain

administrative approval for incurring expenditure on various schemes

included in FERP pending formal approval of the PC-I. To avoid any

subsequent hitch, NHA should immediately move a case for seeking

necessary admin approval.

6.16. The Chief (T&C) added that as was done in two other

contracts of FERP, in this case also NHA issued LoA to the lowest

evaluated bidder after seeking anticipatory approval of Chairman

NHA. He recalled his similar observation during the last Board

meeting and reiterated that formal SOPs should be developed for such

purposes with the approval of the Executive Board to avoid inherent

complications.





19

6.17. The Member (Planning) clarified that the original PC-I of

FERP was based on DNA and that the revised PC-I is being finalized

on the basis of tendered cost. Nevertheless, a case for seeking adminapproval based on original PC-I would be moved, as suggested. The

observation regarding development of SOPs for issuing LoAs after

seeking anticipatory approval of Chairman NHA is already being

attended to.


Decision

6.19. The Executive Board approved award of works for “Rehab

of Chakdara - Kalam Road (N-95), NCB-N-06 Pack-I: Fatehpur -

Madyan (km 82+000 to 89+700)” to M/s Zahir Khan & Brothers (JV)

Techno Time Construction Co at the quoted / evaluated bid amount of

Rs 912,455,000/= (Rupees nine hundred & twelve million, four hundred & fifty

five thousand) only; which is +13.10% the estimated cost (CSR-2009+9.1%)

subject to completion of codal formalities.

6.20. NHA is advised to:-

a. Analyze inclusion of a suitable clause in all future

projects / schemes in which escalation is not allowed

originally (normally upto 12 months duration) but is

allowed subsequently for delay in completion not

attributable to the construction contractor that

escalation will not be allowed on works completed

within the original completion period but permissible

only for balance works.

b. Develop SOPs for issuing LoAs for award of works in

urgent nature cases after seeking anticipatory

approval of Chairman NHA and place the same

before the Executive Board for approval.






20

7. Agenda Item 5

Overlay and Modernization of Lahore - Islamabad

Motorway (M-2) on Build-Operate-Transfer (BOT) Basis


7.1. Introduction. The Lahore-Islamabad 6-lane divided access

controlled Motorway (357 km, M-2) was completed and opened to

traffic in Nov-1997. It has completed its designed life and is showing

deterioration and riding quality is fast going down beyond acceptable

limits. Virtually, it demands complete overlay.

7.2. Overlay and Modernization. NHA has initiated efforts to

save this precious asset and to keep it financially sustainable. If theoverlay / improvement program is delayed, M-2 will enter into

rehabilitation mode and require an investment level of 4 to 5 times

(over Rs 100 billion) higher than current requirement.

7.3. BOT Initiative. Keeping in view the financial constraint

faced by GoP/NHA, M-2 may become financially unsustainable. NHA

has, therefore, decided to undertake the project through Public-

Private-Partnership under Build-Operate-Transfer arrangement to:-

a. Improve existing M-2 to its as-built condition.

b. Modernize M-2 at par with international standards.

c. Gain guaranteed payments of about Rs 19 billion to

remove Salt Range bottleneck through realignment.

7.4. Scope of Work.

a. Overlay of M-2 to achieve improved ride quality to an

international motorway standard of IRI (International

Roughness Index) less than 1.5.

b. Modernization of motorway facilities including:-

i. Electronic toll collection (ETC).

ii. Road safety features and emergency assistance

system.





21

iii. Centralized operation centre with closed circuit

TV.

iv. Traffic counting station/weigh-in-motion

systems.

v. Variable message signs (VMS).

vi. Electronic overloading / police fine collection

system (e-system) & automatic vehicle

classification (AVC).

vii. Landscaping.

viii. Propose business ideas to improve traffic

numbers without compromising safety and

violating motorway definition.

7.5. Advertisement. An advertisement was placed in the press

inviting Requests for Proposal (RFPs) on Oct 12, 2011. Following firms

/ JVs procured RFP documents:

Messers’

a. Frontier Works Organization (FWO).

b. VINCI, France.

c. Sultan Mahmood & Company.

d. Sh Abdur Razzaq & Co.

e. Maqbool Associates (Pvt) Ltd.

f. China State Construction Co.

7.6. BOT Proposal. Out of six (06) firms/JVs, who procured

RFPs, only M/s FWO, ZKB, SACHAL (JV) submitted the BOT proposal.

7.7. Technical Proposal. It was opened on Jul 6, 2012. M/s

FWO, ZKB, SACHAL (JV) secured eighty six (86) points out of 100 and

qualified for opening of financing proposal.

7.8. Financial Proposal. It was opened on Aug 8, 2012. The

IPDF (Infrastructure Project Development Facility) of the Finance Division

assisted NHA in detailed evaluation. The Evaluation Committeerecommended a Letter of Support (LoS) to be issued to the JV.





22

7.9. Salient Features.

a. Project Cost. Rs 36,826 million.

b. Project Financing. Debt : 70% & Equity : 30%.

c. Base Toll Rate. Start of operation (expected year 2016)

for one passenger car unit (PCU) : Rs 1.58 pkm.

d. Other Features.

i. NHA/GoP Support : Nil

ii. Concession Period : Twenty (20) years

iii. Construction Period : Thirty six (36) months

e. Guaranteed Payments. Rs 19 billion will be paid by

the Concessionaire to NHA as follows:-

i. Upfront. Rs 9.50 billion upon achievement of Financial

Close

ii. Balance. Rs 9.50 billion during 4 to 8 year (five years) of

Concession Period @ Rs 1,900 million per year.

f. NHA’s Revenue Share. Rs 189.70 billion (Concession

Years 11 to 20).

7.10. Conclusion. The above is for information of the Board. A

detailed working paper, along with negotiated/ finalized Concession

Agreement, shall be submitted for approval, prior to signing.


7.11. The Member (Motorways/BOT) presented details.

7.12. The VP-NESPAK remarked that the BOT proposal is quite

encouraging but he has following observations:-

a. Entering into a concession of this size and for such a

long period (20 years) demands that NHA’s home-

work is of the highest quality. Previously, concession

agreements for Motorway (M-9) & Shahdara Flyover

(N-5) were approved by the Executive Board but the

projects got stuck up at the financial closure stage.





23

b. NHA should ensure that the Executive Board is given

at least three weeks for study of the draft concessionagreement if & when finalized for detailed study of

various options.

c. NHA’s past experience with FWO for Operation &

Management (O&M) of the Motorways (M-1, M-2 &

M-3) is not very encouraging and this should be kept

in perspective. Therefore, as to how much say NHA

will have during the 20 years concession period may

also be elaborated.

d. FWO is a public sector entity with ultimate recourse

to federal funds; therefore, it is perhaps not a pure

"Public-Private-Partnership" rather a "Public-Public-

Partnership". Is it not like transferring M-2 from one

government entity to another? Opinion from the

Ministry of Law & Justice may be obtained.

e. If FWO can raise money for this project why can't

NHA do it by itself by raising loan against revenue

stream of M-2 for the next 10- 15 years?

f. NHA should carryout detailed (public sector comparative

or value for money) analysis to convince the Board that

it is in the interest of NHA and public to go for BOT

concession on this prestigious multi-billion dollar

asset. This would require precise assessment of

revenues and costs.

g. An analysis indicating Concessionaires Return on

Equity is extremely essential & should be presented

in the Board. Some road agencies fix an upper cap

on RoE to watch the interest of road user / public.

NHA should have a policy to ensure that private

operator does not make windfall profits at the cost of

road users.





24

7.13. The AS (Finance) endorsed the above detailed analysis &

remarked as follows:-

a. Pre-concession negotiations/documentations should

be conducted / prepared in a very careful manner.

b. Motorway is an essential facility from the national

economic perspective; therefore, NHA should also

watch the interest of the road users who should not

be exploited by the BOT Concessionaire by imposing

very high toll rates.

c. Any legal implications on ongoing litigation with M/s

Daewoo for O&M of service areas be also studied.

d. The JV led by FWO is going to raise 30% equity for

the BOT concession and balance 70% is loan. Why

can’t NHA raise this much amount itself instead of

exposing NHA to FWO yet again.

7.14. The IG (NH&MP) remarked as follows:-

a. NHA should carryout a detailed survey of the current

traffic on the motorways and compare it with the toll

actually collected (reported) by FWO. According to his

estimation, at least 30% toll revenue is currently

being misappropriated.

b. Based on the detailed survey and through check on

revenue misappropriation / pilferage and keeping in

view the revised revenue stream, NHA should analyze

the possibility of carrying out overlay of M-2 through

own resources. Further, instead of undertaking this

task in totality, NHA can identify stretches in worst

condition for the overlay to be completed in parts.

7.15. The Chief (NTRC) made following remarks:-

a. It has been stated that M-2 has completed its

designed life but it should also be noted that during

the past 15 years the traffic volume on M-2 hasremained much less than the designed capacity.





25

b. NHA should carryout detailed condition survey of

M-2 to identify stretches in critical condition and

determining the existing roughness index (IRI) for

phased overlay / rehabilitation.

7.16. The Chief (T&C) observed as follows:-

a. While approving PC-I of a project, the recurring cost

is mentioned and this may be provided.

b. Pavement design is prepared to sustain certain axle

load for a pre-determined period. Since heavy traffic

on M-2 could not achieve the anticipated volume due

to various reasons including Salt Range gradient, itmay be intimated as to how any axles have rolled

over M-2 since its opening.

c. Suggestion regarding condition survey is supported

to identify stretches in critical condition.

d. Exact detail/configuration of traffic be provided along

with detail of toll revenue and other income being

generated from M-2 to ascertain true picture of the

revenue stream.

7.17. The Member (MW/BOT) rendered following clarifications:-

a. The proposed BOT concession does not envisage

simple overlay of M-2 but also its restoration to as

built condition besides improvement/modernization

to international standards (details at Annex-D).

b. Through guaranteed revenue of Rs 19 billion removal

of Salt Range bottleneck by realignment is planned.

7.18. The Member (Planning) remarked as follows:-

a. The GoP because of overall financial constraints is

unable to meet the requirement of ongoing / planned

projects and the yearly PSDP allocation of NHA isnormally 30-40% less than the demanded funds.





26

b. NHA has not yet cleared substantial payments for

land acquired for M-2 about two decades back and is

also facing difficulty in making payments for the landpresently being acquired for Motorway (M-4).

c. NHA has not asked any funds from PSDP for overlay

of M-2. If this is delayed any further, the requirement

may transform in to rehab and even reconstruction,

the cost of which would be phenomenal.

d. NHA is following the GoP instructions regarding

maximization of off-budget financing.

e. FWO has provided a certificate that it operates as a

commercial company.

f. Bid is close to parameters pre-defined by the IPDF.

g. NHA will ensure that all observations made by the

honorable Board Members are kept in perspective

while processing / negotiating concession agreement.

7.19. The Chairman remarked that services of a financial

analyst be hired for detailed scrutiny of the concession agreement.

Decision

7.20. The Executive Board reviewed the working paper

regarding “Overlay and Modernization of Lahore-Islamabad Motorway

(M-2) on Build-Operate-Transfer (BOT) Basis” and advised NHA to

keep all the observations discussed above before finalizing concession

agreement with the JV comprising M/s FWO, ZKB & Sachal.

Note. Since the Finance Division has issued Dollar denominated Sukuk in

international capital market & Rupee denominated Sukuk in local capital

market, against Motorway (M-2), NHA on Oct 22, 2012 referred the matter to

MoC with the request to approach Finance Division to seek clearance for NHA

to proceed ahead with the subject BOT process.

Action By : Member (Motorways/BOT)





27

8. Agenda Item 6

Construction of Hiran Minar Interchange on Lahore -

Islamabad Motorway (M-2) at Km 51+886 : Request

for Invoking Clause 70.1 (Price Adjustment)


8.1. Background / Introduction.

a. NHA has taken up the subject project on a directive

notified by the Prime Minister’s Sectt on Dec 1, 2006

for development of tourism industry by providing a

comfortable access to Hiran Minar via Lahore -Islamabad Motorway (M-2).

b. Construction of an intersection at km 51+886 on M-2

provides the shortest link to Hiran Minar and this

constitutes second such facility near Sheikhupura in

addition to an interchange on Sheikhupura -

Gujranwala Road.

8.2. Scope of Work.

a. Interchange is being constructed by incorporating

existing bridge across M-2 on Hafizabad -

Sheikhupura Road.

b. Project includes two separate ramps for 2-way traffic

connecting M-2 with this road both to the north &

south forming a T-junction on either end of the

ramps.

c. Project also includes Toll Plaza and Admin Building

including sanitary, water supply and electric works.

8.3. PC-I. PC-I of Rs 183 million was cleared by CDWP on Sep

17, 2009 with the directions that project cost be updated based on

NHA’s CSR-2009 with permissible premiums & got cleared by

Chairman CDWP. Cost was updated to Rs 260.319 million.





28

8.4. Contract. Contract for construction of Hiran Minar

Interchange was awarded with a completion period of 6 months:-

a. Contractor : M/s Luqman Brothers

b. Design Consultant : M/s REC (Pvt) Ltdc. Supervisory Consultant : -do-

d. Commencement : Jul 7, 2010

e. Completion : Jan 2, 2011

f. Progress : 65%

8.5. Delay. The Sub-Clause 70.1 (Price Adjustment) was deleted

as the project duration was less than six months. However, the project

has been considerably delayed due to following reasons:-

a. Agreement for hiring of M/s REC as supervisory

consultant was signed on Jun 18, 2010. M/s REC

was to review the original design (prepared in 1999) as

per current conditions within one month of the

signing of the contract agreement.

b. M/s REC took 3 months for design review and it was

got approved from NHA on Sep 6, 2010. This delayed

the project for almost 3 months. Further 3 months

were consumed for latest soil investigations.

c. Payment to WAPDA on part of the Employer was

delayed for a considerable period of time.

d. Payments to contractor were delayed for almost 6

months due to which EoT up to Jun 29, 2012 was

necessitated.

8.6. Incorporation of Escalation Clause.

a. Project has got delayed by almost one year due to no

fault of the contractor. Therefore, as recommended

by PD and Senior Procurement & Contract Specialist,

the contractor cannot be penalized for the delay.

b. It is proposed that Clause 70.1 (Price Adjustment) may

be invoked through an amendment in the contractagreement in accordance with PEC guidelines.





29

8.7. Proposal. Executive Board’s approval is requested.


8.8. The Member (Construction) presented details. The GM(Construction-N) was also present.

8.9. The Chief (T&C) had forwarded some written observations,

which were responded as follows:-

a. Whether provision for escalation was made in the

approved PC-I. If, not then without approval of

revised PC-I, the proposal cannot be supported.

It is confirmed that the approved PC-I has provision

of escalation. Since, original completion period was 6

months escalation clause was not incorporated.

b. M/s REC signed agreement with the client on Jun

18, 2010 based on design carried out in 1999

without latest soil investigation. Why NHA did not

look into this matter and now the proposal for

inclusion of "Price Adjustment" clause in contract

agreement is being made with 65% progress?

Project was designed in 1999 for link road, therefore,

for ramps in ponding areas slush was replaced with

sand. Without proper design road would have failed,

as such, soil investigation / testing was conducted

by the University of Engineering & Technology,

Lahore prior to commencement of work.

c. Whether the issue has the in-house consensus

including the Finance Wing.

It is confirmed that NHA Finance Wing has accorded

concurrence.

d. At this stage. if the proposal is accepted, then actual

cost of escalation will be more than Rs 42 million atthe time of completion of project.





30

Overall increase including escalation cost is within

15% of the original PC-I cost, therefore, revision of

the PC-I would not be required.

e. It should be clarified whether escalation has beenworked out as per actual expenditure.

It is confirmed that the escalation has been

calculated as per actual payment.

f. There is no allocation for the project in PSDP 2012-

13. How the funding will be arranged?

Expeditious completion of the interchange is inNHA’s interest as expected toll collection is Rs 50

million plus annually.

g. What is the status of revised PC-I.

As explained against “d” above.

8.10. The Chief (NTRC) observed that the project was advertised

as a fixed price contract, as such, it may be explained whether

inclusion of escalation clause at this stage is legally tenable.

8.11. The AS (Finance) observed that post tender amendments

to contract conditions does not appear to be fair to other bidders.

Matter needs to be certified by PPRA or PEC.

8.12. The Member (Construction) clarified that this proposal

has been brought before the Executive Board as per the policy

decision taken by the Board in 2008.

8.13. Note. The Executive Board in its 160th meeting held on

Sep 24, 2008 took the following decisions:-

a. “The Executive Board approved incorporation of escalation Clause 70.1 in the Conditions-of-Contract (Part-II) in all ongoing maintenance / development contracts awarded during or subsequent to July 2007

of more than six months duration.





31

b. The Board further decided that specific project, if any,of less than six months duration requiring suitable remedial action because of non inclusion of escalation clause would be identified and brought before the Board for decision on merit with detailed justification

/ cost effect.

c. Real escalation (positive or negative) will be paid on a monthly basis against actual work done and actual consumption of materials after its detailed assessment on a case-to-case basis.”

8.14. The Chief (T&C) pointed out that it has been stated in the

working paper that the price adjustment clause is proposed to be

invoked in accordance with PEC guidelines. A copy of these guidelines

be placed before the Board.

8.15. Matter was discussed and it was decided that a copy of

the PEC guidelines be placed before the Board.

Decision

8.16. The Executive Board considered the working paper

seeking approval for inclusion of Clause 70.1 (Price Adjustment) clause in

the contract agreement for “construction of Hiran Minar Interchangeon Lahore - Islamabad Motorway (M-2) at Km 51+886” and decided

that the matter would be reconsidered when a copy of the relevant

provisions of PEC guidelines is placed before the Board.

Action By : Member (Construction)

9. Agenda Item 7Addendum-3 of M/s Indus Associated Consultants forConstruction Supervision of Ratodero - Naudero

Project (15 Km)


9.1. Introduction.

a. The GoP has entrusted to NHA the responsibility for

construction & development of a number of roads

under the President of Pakistan’s Sindh Development

Package including Ratodero - Naudero Road.





32

b. Project consists of rehab/up-gradation of Ratodero -

Naudero Road (14.785 km) including 2 km internal

roads. It caters for existing/future intercity traffic to

help develop the area besides improved connectivity

with Ratodero - Khuzdar - Gwadar Road (M-8).

c. Overall objective is to facilitate travel between

Larkana & Indus Highway (N-55) through reduction

in transport travel time / vehicle operating cost at an

economical & financially sustainable level.

d. This road already stands federalized as National

Highway (N-55).

9.2. Construction Contract.

a. Contract for construction of Ratodero-Naudero Road

Project was awarded to M/s Sachal Engg Works at a

cost of Rs 790 million.

b. Commencement was fixed as Sep 6, 2009 and

completion Nov 30, 2010 (15 months). However, the

Contractor was granted Extension of Time (EoT) and

revised completion date was fixed as Feb 23, 2011.

Project has been substantially completed.

9.3. Design & Supervision Consultancy.

a. M/s Indus Associated Consultants was assigned the

design & supervisory consultancy at a cost of Rs

13,151,500/- but for 6 months only.

b. Addendum-1 of Rs 3,557,767/- was approved for

additional cost of Naudero Bypass.

c. Addendum-2 of Rs 19,161,120/- was approved for:-

i. Grant of EoT for supervision till Nov 30, 2010.

ii. Inclusion of additional staff appointed directly by NHA to meet own staff requirements.





33

9.4. Delay. Completion of the project got delayed for various

reasons including delay in payment of certified payments of the

Contractor by NHA, disruption of work by land claimants and

relocation of utilities.

9.5. Addendum-3 of M/s Indus Associated Consultants.

a. Needed for construction supervision till project

completion as fixed by NHA against recommendation

of Resident Engineer and “the Engineer” that the

agreement may be extended in line with the

completion date fixed for Contractor with full

strength of supervision staff upto Aug 31, 2011 andwith reduced staff till Oct 31, 2011 for settlement of

issues/finalization of accounts.

b. NHA Finance Wing has accorded concurrence.

9.6. Fiscal Summary/Variation.

Cost Rupees Variation

a. Original 13,151,500 ---

b. Addendum-1 3,557,767 + 27.05%

c. Addendum-2 19,161,120 + 145.70%

d. Revised (a+b+c) 35,870,387 + 172.75%

e. Addendum-3 13,024,000 +99.03

Total Revised (d+e) 48,894,387 +271.78%

9.7. Project PC-I.

a. PC-I of Rs 623 million was approved by ECNEC onNov 6, 2008. Revised PC-I has been prepared and is

under scrutiny by NHA Planning Wing.

b. Provision for consultancy in the original PC-I is Rs

16.05 million, however, an amount of Rs 50 million

has been provided in the revised PC-I.

9.8. Recommendation. The Executive Board is requested to

approve Addendum-3 of M/s Indus Associated Consultants costingRs 13,024,000/=.





34


9.9. The Member (Construction) presented details.

9.10. The AS (Finance) observed that increase in consultancy cost by +271.78% is on very high side and needs detailed justification.

He also wished to know if the construction cost has also increased.

9.11. Further detailed discussion in this case could not be held

because of paucity of time and it was decided that a fresh working

paper may be processed for the next Board meeting.

Decision

9.12. The Executive Board considered the working paper

seeking approval of “Addendum-3 of M/s Indus Associated

Consultants for construction supervision of Ratodero - Naudero Road

costing Rs 13,024,000/=” and directed that a fresh working paper

may be processed for the next Board meeting.


10. Agenda Item 8Addendum-1 of M/s Techno Consult International

(Pvt) Ltd for Construction Supervision: Hyderabad -

Badin to Mir Wah Sanjar Chang Road


10.1. Project Road.

a. Subject project has been assigned to NHA on thedirections of the President of Pakistan as deposit

work. It connects many cities of Districts Badin and

Tando Allahyar.

b. Project road starts at km 50 of Hyderabad - Badin

Road and terminates at Mirwah - Sanjar Chang

Road. It will constitute a significant link in road

network of Hyderabad Division and facilitate the flow

of traffic commuting through Tando MohammadKhan, Badin and Tando Allahyar Districts.





35

c. The existing stretches of the road measuring 20.547

km (km 0+000 to 1+125, km 20+225 to 27+835, km 35+100 to

44+700 and km 46+225 to 48+337) had deterioratedextensively. Moreover, within project route

alignment, the road is discontinued and does not

exist in many stretches totaling 27.790 km.

10.2. Scope of the Project.

a. Scheme envisages provision of 48+337 km long, 6.1

m wide (two lanes of 3.05 m each) road link between

Hyderabad - Badin Road and Mir Wah - SanjarChang Road through reconstruction of existing

stretches totaling 20.547 km and construction of a

new road over the remaining stretches measuring

27.790 km.

b. Project scope also includes construction of new

structures viz 4 bridges & 222 culverts & setting up

of necessary road furniture.

10.3. Project Packages for Construction Work.

I. Construction / improvement of 24.40 km (km

0+000 to 24+400) road from Jagsi Goth to Haji

Sawan Road.

II. Construction / improvement of 23.937 km (km

24+400 to 48+337) road from Haji Sawan Road to

Mirwah Sanjar Chang Road.

10.4. Project PC-I.

a. PC-I of Rs 880.110 million based on estimated

quantities was processed in Oct-2009 and cleared by

CDWP on Nov 19, 2009 subject to revision of

scope/cost rationalization.





36

b. Cost was later rationalized to Rs 835.226 million on

CSR Jan-2009 with no premium. However, bid cost

of only Pack-I was Rs 719.517 million and Pack-II Rs

664.499 million making a total of Rs 1384.016

million necessitating revision of the PC-I.

10.5. Contacts. Following construction contracts are being

supervised by M/s Techno Consult International (Pvt) Ltd:-

Pack Contractor (M/s) Rs in M Start Progress Completion

I.Maqbool

Associates801.70

Feb-

201097% Aug-2012

II. SARCO 664.50Oct-

201055% Nov-2012

10.6. Addendum-1. Necessitated due to grant of EoTs to

construction contractors to complete the work as under:-

Pack Contractor (M/s) EoT

I. Maqbool Associates Feb 25, 2012

II. SARCO Jun 30, 2012

10.7. Fiscal Summary/Variation.


a. Original 38,409,000 ---

b. Addendum-1 22,219,622 + 57.85 %

c. Total (a +b) 60,628,622 + 57.85 %

10.8. Proposal. Approval of Addendum-1 of M/s Techno

costing Rs 22,219,622/= entailing EoT from Jun 10, 2011 to Jun 30,

2012 (387 days).


10.9. The Member (Construction) presented details.

10.10. On an observation if further addendum of M/s Techno

would also be processed, the Member (Construction) responded in

affirmative stating that Pack-I has been substantially completed but

progress on Pack-II is yet 55%.





37


Decision

10.12. The Executive Board approved Addendum-1 of M/s

Techno Consult International (Pvt) Ltd, for “Construction Supervision

for Road from Hyderabad Badin to Mirwah Sanjar Chang Road”

costing Rs 22,219,622/= (Rupees twenty two million, two hundred & nineteen

thousand, six hundred & twenty two) only having net cost effect of

+57.85% vis-à-vis original contract cost 60,628,622/= entailing EoT

from Jun 10, 2011 to Jun 30, 2012 (387 days).


11. Agenda Item 9

Addendum-3 of M/s NESPAK for Updation of LARP of

M-4: Gojra-Shorkot, Section-II and Shorkot-Khanewal

Section-III, Alongwith Interchanges


11.1. Introduction (M-4).

a. The Faisalabad- Khanewal Motorway (M-4, 184 km)

begins at the end point of Pindi Bhattian -

Faisalabad Motorway (M-3) at Sargodha Road

Interchange in northern outskirts of Faisalabad City.

b. M-4 alignment originally terminated near Khanewal

on N-5 traversing Gojra, Toba Tek Singh and

Shorkot. In 2008, the Prime Minister, announced a

Special Development Package for Southern Punjab. It

included extension of M-4 from Khanewal to Multan.

c. The Faisalabad-Khanewal Section is being

constructed through Asian Development Bank’s

financing and Khanewal - Multan Section through

Islamic Development Bank’s financing.





38

11.2. Project PC-I Status (M-4).

a. PC-I of Rs 28,566.74 million was approved by

ECNEC on Jun 2, 2008 for Faisalabad - Khanewal.

b. PC-I of Rs 3.957 billion for land acquisition and

allied facilities was approved by ECNEC on Sep 19,

2007 for Faisalabad - Khanewal.

c. Revised PC-I of Rs 14.4949 billion was approved by

ECNEC on Dec 9, 2010 for Khanewal - Multan

(Extension).

11.3. Construction Packages (Faisalabad-Khanewal).

Section Km

I. Faisalabad-Gojra 58

II. Gojra-Shorkot 62

III. Shorkot-Khanewal 64

Total 184

11.4. Land Acquisition & Resettlement Plan (LARP).

a. LARP has been approved by ADB for main

carriageway and land acquisition of Section-I

(Faisalabad - Gojra, 58.2 km) done accordingly. LARP for

interchanges of Section-I is under process.

b. Land acquisition for 35 km of Section-II (Gojra -

Shorkot) has been completed and remaining 27 km is

under process. LARP is being prepared by NESPAKwho submitted the draft on Aug 31, 2012.

c. Land acquisition of Section-III (Shorkot - Khanewal) is

also under process. LARP is being prepared by

NESPAK & draft will be submitted by Oct 15, 2012.

d. Land acquisition and EIA (Environmental Impact

Assessment) for M-4 Extension (Khanewal - Multan) was

also prepared by NESPAK. Awards for landannounced and construction work is ongoing.





39

11.5. Agreement with NESPAK.

a. Agreement with NESPAK was concluded in Jan-2007

for Rs 4,691,952/=. Original scope of workcomprised preparation of EIA and LARP of

Faisalabad-Khanewal.

b. NESPAK prepared and submitted to NHA necessary

reports; which were approved by ADB.

11.6. Addendum-1.

a. It was agreed by ADB in Jun-2008 that LARP indifferent sections would be prepared separately (one

for each section total three LARPs) after conducting

extensive socio-economic survey of M-4 (Faisalabad-

Khanewal).

b. Due to this additional scope of work, Addendum-1

was approved in Jul-2008 with revised cost of Rs

6,488,952/= viz +38.3% variation.

c. LARP for RoW of main carriageway of Section-I

(Faisalabad – Gojra) was prepared as per ADB’s

Safeguard Policy and submitted to ADB. It was

approved and construction activity allowed by ADB.

11.7. Addendum-2.

a. The GoP approved Khanewal - Multan Extension (57

km) in 2009. Additional field activities to prepare

independent LARP and EIA were required for this

section and this task was assigned to NESPAK, being

already mobilized on M-4, under Addendum-2.

b. Revised cost after Addendum-2 was Rs 8,160,952/=

viz +73.94 % cumulative variation. This addendum

was approved in Mar-2009 and formalities were

completed in Aug-2012.





40

11.8. Addendum-3.

a. ADB again reviewed its Safeguard Policy in 2009 and

approved Revised LARF (Land Acquisition & Resettlement

Framework) in 2010. To comply with the requirementof this new policy, NHA has to update LARP for

Sections-II & III entailing additional scope of work.

b. Scope/cost of Addendum-3:-

Rupees

i. Verification of land ownership (already done

in Mar-2007, but approval not accorded by

ADB)

2,987,923

ii. Verification & updating of LARP as per

latest ADB Policy and LARF 2010

4,512,077

Total 7,500,000

c. Revised cost after Addendum-3 is Rs 15,660,952/=

viz +233.78 % cumulative variation.

11.9. Cost Effect/Fiscal Summary/Variation.


a. Original 4,691,952 ---

b. Addendum-1 1,797,000 +38.30%

c. Addendum-2 1,672,000 +35.64%

d. Revised (a+b+c) 8,160,952 +73.94%

e. Addendum-3 7,500,000 +159.84%

Total (d+e) 15,660,952 +233.78%

11.10. NHA Code. The NHA Executive Board is the competent

authority to approve Addendum-3 as per NHA Code 2005.

11.11. Proposal. Approval of Addendum 3 of NESPAK.


11.12. The GM (M-4) presented details.






41

Decision

11.14. The Executive Board approved Addendum 3 of M/sNESPAK for preparation of LARP for M-4 Sections-II & III as per ADB’s

New Safeguard Policy-2009 and Revised LARF-2010 costing Rs 7.5

million (Rupees seven million and five hundred thousand) only.

11.15. Revised agreement cost will be Rs 15,660,952/= having

total +233.78 % variation vis-à-vis original cost.

Action By : Member (Aided Projects)

12. Agenda Item 10

Revised Estimates 2011-12 & Budget Estimates

2012-13

12.1. Discussion on this working paper could not be held

because of paucity of time. This matter will, therefore, be taken up in

the next Board meeting.

12.2. The Chief (T&C), however, desired that while presenting

fresh working paper, copies of supporting documents / data may also

be added. He also suggested that the next year’s PSDP allocation

proposed by NHA should also be discussed in the Board before

presentation to the Planning Commission.

Action By : Member (Finance) & Member (Planning)

13. Agenda Item 11

Financing Arrangement for NHF and Welfare

Measures for NHA Employees & Their Families:

Transfer of 50% of NHA's Police Fine Share to NHF

13.1. The Secretary NHA apprised the Board that the subject

working paper has been withdrawn.

Action By : Member (Operation)





42

14. Agenda Item 12

Modified PC-I for Amri - Qazi Ahmed Bridge Across

River Indus (Between Hyderabad Bypass and Dadu -

Moro Bridge) Connecting N-5 with N-55


14.1. Original & Revised PC-I.

a. PC-I for construction of Amri - Qazi Ahmed Bridge

across River Indus (between Hyderabad Bypass and Dadu -

Mora Bridge) connecting N-5 with N-55 was approved

by ECNEC at a rationalized cost of Rs 3,683 million

on Jan 21, 2010.

b. Scope of work envisaged construction of a 2-lane,

1,241 m main Bridge with 15.431 km approach

roads, 2-flyovers (each at an interchange at N-5 and N-55),

guide banks and other allied structures.

c. PC-I was revised due to enhancement of the Bridge

from 2-lane to 4-lane in view of verbal instructions

of the President of Pakistan to the Chairman NHA.

d. Revised PC-I, prepared at pre-award status, was

discussed on Jul 24, 2012 (219th Board meeting) at a

cost of Rs 5,290.41 million and recommended for

approval by CDWP/ECNEC.

14.2. Modification. Scope of work has been further modified due

to inclusion of additional river training works (Spur and Dike).

14.3. Revision in the Scope of Work from Time-to-Time.

a. Original PC-I (Rs 3,683 million; Jan-2010).

i. Construction of a 2-lane, 1,241 m long main bridge.

ii. Construction of 15.431 km approach roads.

iii. Construction of 2-flyovers.

iv. Construction of guide banks and other allied structures

(cost estimated without Model Study).v. PC-I was based on NHA’s CSR 2009 (Dadu, Sindh).





43

b. Revised PC-I (Rs 5,290 million; Jul-2012).

i. Conversion of 2-lane bridge into 4-lane.

ii. Cost estimation based on actual tendered rates.

c. Modified Revised PC-I (Rs 6,892 million; Oct-2012) -

After Hydraulic Model Study.

i. Increase in length of bridge from 1,241m to

1,320 m; addition of three (03) spans.

ii. Addition of river training works (Spur and Dike) as

emerged after the Model Study and consultation

with Sindh Irrigation Department.

iii. Increase in length of approaches from 15.4 km to

19.3 km.

iv. Cost is based on tendered rates for awarded

works, CSR-2009 + 9.1% for guide banks and

tendered rates for conversion of 2-lane bridge

into 4-lane.

14.4. Project Cost. Original and revised costs of the project

compare as under. Detailed comparison is at Annex-E:-

Cost Rs in Million

a. Original 3,683.000

b. Revised 5,290.418

c. Modified Revised 6,892.109

14.5. Funds. Rs 500 million allocated in PSDP 2012-13.

14.6. Implementation. Project scheduled for construction in 5

years after start in FY 2011-12 depending upon availability of funds.

14.7. Economic Analysis.

a. Benefit Cost Ratio : 3.741:1

b. Internal Rate of Return : 29.81 %c. Net Present Value : Rs 11,185.01 M





44

14.8. Proposal. Recommendation of the modified PC-I costing

Rs 6,892.11 million to the CDWP/ECNEC for approval.


14.9. The Member (Planning) introduced the proposal and the

GM (Planning) presented details. The Member (Construction) and GM

(Design-1) were also present.

14.10. The Chief (T&C) pointed out that it has been stated in the

working paper that the raising of bunds due to revised requirement of

Federal Flood Commission (minimum 7 ft) shall be done by Sindh

Irrigation Department for which cost is not indicated in the PC-I. The

modified PC-I should have been prepared in totality and the cost of Sindh Government’s component also included after consulting all

stakeholders.

14.11. The GM (Design-1) clarified that after approval of the

original PC-I, which was prepared without model study, the river flow

pattern was changed by the Superfloods-2010. The peak flood left a

free board of only 6 inches on the flood protection bund. Subsequent

to construction of the new bridge additional flux would be created

compelling raising of the bund, which is Sindh Government’s domain.

14.12. The Sindh Irrigation Deptt has not been rendering

unstinted cooperation while NHA is under instructions of the GoP

higher-ups to complete this project at priority. Resultantly, indulgence

of WAPDA was sought and it was on the intervention at the level of

Member (Power) WAPDA (now Chairman) that certain technical issues

were resolved. Any further consultations with the provincial

authorities would delay processing of the modified PC-I.

14.13. The Chief (T&C) agreed that raising of the protection bund

is beyond NHA’s purview but reiterated that NHA may obtain relevant

input / cost estimates from the provincial authorities concerned and

add the same to the modified PC-I cost and leave further decision in

the matter to the CDWP.

14.14. The AS (Finance) endorsed the above remarks stating that

the project cost should be holistic but NHA can highlight as to whichcomponents of the PC-I pertained to the provincial government.





45

14.15. On another observation by the Chief (T&C) it was clarified

that the cost of land acquisition and length of approaches has

increased due to addition of loops to the interchanges.

14.16. Matter was discussed and cleared. However, it was finally

decided that to save on time NHA would include Rs 400 million in the

project cost for raising of protection bund and submit the PC-I to the

Planning Commission where this cost will be rationalized after detailed

scrutiny.

14.17. The Chairman NHA remarked that the revised PC-I before

submission to the Planning Commission will be scrutinized by theprescribed Technical Working Party.

Decision

14.18. The Executive Board recommended the modified PC-I for

“construction of Amri-Qazi Ahmed Bridge across River Indus (between

Hyderabad Bypass and Dadu - Mora Bridge) connecting N-5 with N-55” at a

cost of Rs 7292.11 million to the CDWP/ECNEC for approval.

Action By : Member (Planning) & Member (Construction)

15. Additional Agenda Item I

Award of Works Under Flood Emergency Re-

construction Project (FERP) : NCB-S-12 Construction

of Bridge Across Vadoor Nullah at Km 96-97 (N-70)


15.1. ADB Loan/ Scope of Work.

a. Pakistan has received a loan (PAK 2742) from the

Asian Development Bank (ADB) towards the cost of

Flood Emergency Reconstruction Project (FERP).

b. Subject project ie NCB-S-12 Construction of Bridge

over Vadoor Nullah at km 96-97 (N-70) is included in

Phase-I of FERP.





46

15.2. Global PC-I.

a. Global PC-I of FERP based on DNA (Damage Need

Assessment) study conducted by NESPAK waspresented in ECNEC meeting held on May 26, 2011.

The ECNEC approved the PC-I, in principle, with the

following instructions:-

“The ECNEC considered the summary dated May 4, 2011

submitted by the Planning Commission titled “Rehabilitation of

National Highway Network Damaged due to Unprecedented

Monsoon Rains & Flash Floods 2010” and approved the project,

in principle, and authorized Dy Chairman Planning Commission/

Chairman CDWP to approve the reviewed scope and cost of project duly vetted by the high level Committee constituted by the

CDWP.”

b. Revised PC-I is under preparation and included in

the deliverables of design consultants.

15.3. Engineer’s Estimate. Rs 99,145,096/= (CSR 2009+9.1%).

15.4. Tendering.

a. Procurement of subject works was undertaken on

Single-Stage-Two-Envelopes basis for civil works in

accordance with ADB’s guidelines.

b. Escalation shall not be applicable on contracts

having 12 months or less duration. Being 9 months

project, escalation is not applicable in this case.

c. Advertisement for Invitation of Bids (IFB) was

published in the press and displayed on NHA and

PPRA websites on Apr 27, 2012. Bid documents were

procured by eleven (11) eligible firms individually or

as JV.

d. Five (5) firms submitted technical and financial bids

on the due date viz May 14, 2012:-





47

Messers’ Legend

i. Techno Time Construction Company Techno Time

ii. Mohandisin-e-Masud Builders, Engineers Mohandisin

iii. Sh Abdur Razzaq & Company (Pvt) Ltd SARCO

iv. Haji Noor Muhammad & Sons HNMS v. Sachal Engineering Works (Pvt) Ltd Sachal

15.5. Technical Evaluation.

a. Technical bids were opened on May 14, 2012 by the

Bid Opening & Evaluation (BO&E) Committee in the

presence of Reps of the bidders. Price bids were kept

unopened and sealed in safe custody.

b. Technical bids were evaluated in accordance with

qualification criteria stipulated in bid documents. As

a result, bid of M/s Haji Noor Muhammad & Sons

was evaluated as “unqualified.”

c. Technical Bid Evaluation Report was approved by

ADB on Jun 20, 2012.

15.6. Financial Bid Evaluation.

a. Financial bids were opened on Jun 21, 2012 in the

presence of BO&E Committee. Quoted/announced

bid prices were as summarized below:-

Bidder (M/s) Rupees

i. Techno Time 127,302,427

ii. Mohandisin 138,500,000

iii. SARCO 142,333,667

iv. Sachal 148,422,770

b. Bids were evaluated in accordance with ADB’s

standard procedures. However, there were certain

typographic and arithmetic errors in the bids of M/s

Techno Time, M/s Mohandisin and M/s Sachal.

15.7. Summary. Summarized comparison vis-à-vis estimated

cost of Rs 99,145,096/= (CSR 2009 + 9.1%) is as under-





48

Rank Consultant (M/s) Submitted (Rs) Corrected (Rs) Variation

1st Techno Time 127,302,427 127,302,466 +28.40%

2nd Mohandisin 138,500,000 131,381,382 +32.51%

3rd SARCO 142,333,667 142,333,666 +43.56%

4th Sachal 148,422,770 148,454,069 +49.73%

15.8. ADB’s Concurrence. The Priced Bid Evaluation Report

was forwarded to ADB for review/concurrence on Jun 27, 2012. The

ADB issued NOC dated Jul 2, 2012 for award of works to M/s Techno

Time Construction Company at Rs 127,302,466/-.


recommended acceptance of the bid of Rs 127,302,466/= of M/s

Techno Time Construction Company.


15.10. The Member (Planning) presented details. The Member

(Operation), GM (P&CA) & GM (Design-1) were also present.

15.11. The VP-NESPAK observed that the lowest bid at +28.40%

the estimated cost is on higher side particularly if compared with the

bids generally received in the recent past. Moreover, the project is also

not located in a hard or security prone area. The Board may consider

fixing a limit for acceptance of bids higher than the estimated cost as

even competitive bidding can be manipulated. He also enquired if a

bid with such a high variation was accepted in the past.

15.12. It was clarified that NHA is engaging contractors for anumber of schemes under FERP & the bids are generally competitive

barring that under debate. Bids for other development projects invited

on single stage two envelope basis during the past around 12 - 15

months were also quite competitive. However, during 2009 and 2010

bids of even more than 30% the estimated cost were accepted. Re-

tendering is an option but it will take more than 3 months, whereas,

NHA has to finalize the bidding process under FERP at priority as per

the understanding reached with ADB.





49

15.13. On the suggestion regarding fixing an upper limit, it was

submitted that the single stage two envelop system has proved quitebeneficial in attracting competitive bids and the ADB guidelines for

technical evaluation are also reasonably stringent. Therefore, the

existing system may continue.

15.14. On another observation, it was clarified that the estimated

cost was based on CSR-2009 + 9.1% premium and if the bid is

compared with the recently approved CSR-2011, it is almost at par as

the difference between CSR-2009+9.1% premium and current rates is

in the range of 30%.

15.15. The Member (Operation) conveyed that Vadoor Nullah

receives water only in case of heavy rains and a culvert originally

existed at this site but was washed away in the Superfloods-2010. For

the past two years, traffic is passing through a temporary diversion

and the road users are facing extreme difficulty at this bottleneck. It is

essential that the bridge is completed before next monsoon season.


15.17. The Chief (T&C) remarked that his observations regarding

administrative approval for incurring expenditure on FERP pending

formal approval of global PC-I hold good in this case too (Para-6.15).

Decision

15.18. The Executive Board approved award of works for “NCB-

S-12 Construction of Bridge Across Vadoor Nullah at Km 96 - 97

(N-70)” to M/s Techno Time Construction Company at the quoted /

corrected bid amount of Rs 127,302,466/= (Rupees one hundred & twenty

seven million, three hundred & two thousand, four hundred and sixty six) only;

which is +28.40% the estimated cost (CSR-2009+9.1%) subject to

completion of codal formalities.






50

16. Additional Agenda Item II

Upgradation of Misc Posts in BS-1 to 16 of NHA

Employees

16.1. The Secretary NHA solicited permission of the Executive

Board for tabling working paper on the subject matter, as directed by

the Chairman NHA. However, due to paucity of time, it was decided

that this matter will be considered in the next Board.

Action By : Member (Admin)

17. Status Report on Revised PC-Is and Scrutiny of Revised PC-Is by the Technical Working Party

17.1. The Chairman during the course of discussion on award

of works remarked that in most of the cases expenditure on various

projects exceed the permissible 15% limit of the approved PC-I. He has

already directed all concerned Members of NHA to expedite processing

of revised PC-Is of completed / near completion projects and would

like that a special Board meeting be convened for review of all such

PC-Is in Dec-2012.

17.2. The AS (Finance) remarked that this is a much needed

exercise not only for identifying the cost impact because of delay in

completion of projects and due to variation orders issued from time-

to-time but also to critically analyze the lessons learnt for corrective

actions. He suggested that a comprehensive briefing on each mega

project entailing time / cost overrun be arranged for the Board.

17.3. The Member (Planning) stated that revised PC-Is of a large

number of projects are required to be processed and this might not be

possible by Dec-2012, however, effort would be made to expedite as

many revised PC-Is as possible within the next 2-3 months.

17.4. The Chairman further remarked that all fresh and also

revised PC-Is should be processed through the prescribed Technical

Working Party (TWP) before submission to the Executive Board.





51

17.5. The above suggestions were appreciated and endorsed by

the Members.

17.6. Note. For scrutiny of revised PC-Is of development projects

/schemes by the TWP, no clause exists in NHA Code 2005. In view of the above decision, the relevant contents of NHA Code (Sections 50 & 51,

Chapter-2 -- Planning Process) will be suitably modified.

Action By : Member (Planning), Member (Construction),

Member (Aided Projects) and Secretary NHA

18. Tribute to Mr Muhammad Ali Gardezi, FormerChairman NHA

18.1. Mr Muhammad Ali Gardezi, a BS-21 officer of Pakistan

Administrative Service, served as the Chairman NHA on deputation

from Jul 6, 2011 to Oct 2, 2012. During his 15 months tenure Mr

Gardezi throughout endeavored and worked untiringly to improve the

working system of NHA. When he joined, NHA was in poor financial

health and the situation warranted special steps / measures. When

Mr Gardezi left in Oct-2012, the general situation of NHA projects and

the reputation of NHA improved substantially in the eyes of general

public, stakeholders and decision makers.

18.2. The Executive Board unanimously resolved to pay glowing

tributes to Mr Muhammad Ali Gardezi for the services rendered and

the quality leadership provided by him as the Chairman NHA. His

contribution and untiring efforts would be long remembered. The

Board wished him best of luck and success in his future career and

the times ahead.

19. Conclusion

19.1. The Chairman wrapped up the meeting by thanking the

Members for their active participation and useful input in this first

Board meeting chaired by him. He expressed the hope that with the

cooperation and assistance by the Board Members, the working

system and output of NHA would be further improved and this would

be of immense benefit to entire Pakistan, the national highways being

the economic lifeline of the country.

------------------

222 executive borad meeting of nha

Documents