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Senior Reporter

HARARE City Council and a private contractor it had engaged for the construction of a 100-kilowatt bio-digester in Mbare in 2015 at a cost of US$465 290, partially provided by the European Union with the rest using ratepayer funds, have gone to arbitration after the company failed to complete the project despite being paid in full.

Acting Harare town clerk Engineer Mabhena Moyo yesterday told a joint sitting of the Portfolio Committees on Energy and Power Development and on Environment, Climate and Tourism that the matter had been taken for arbitration after Synlak Private Limited failed to fulfil its contractual obligations.

The contractor was paid the money between September 2015 and June 2016 when the project was supposed to be completed. Harare City Council received a grant from the European Union under the non-state-actors funding in December 2013 to build a 100kW biogas plant in Mbare.

“The grant was for implementing a biogas-based waste management in Mbare. The grant was for €350 000 (about US$390 000) and of this amount the council received US$70 000. Council was to provide any additional funding required in executing the project.

“City of Harare awarded a contract and subsequently signed a Memorandum of Agreement with Synlak (Pvt) Ltd in September 2015 for the design and construction of four biogas digesters and the supply, installation, and commissioning of a 100kVA biogas generator — COH/ DOW/S9/2015. The contract value was $465 290,” Engineer Moyo said.The acting Town Clerk said in June 2017, the council wrote to the contractor giving it a deadline to complete the project within 14 days.

“The contractor failed to rectify the breach leaving Council with no option but to cancel the contract. The Acting Town Clerk wrote to the contractor on 2 January 2018 advising them of the cancellation of the contract,” Eng Moyo said.

The Council then carried out an assessment of work that had been done against payments made which established that the total value of the work done was $243 535 suggesting an overpayment of $221 755 with the local authority resolving to recover the overpayment.

Following the cancellation of the contract, the contractor wrote to Council in February 2018 that the major component required to ensure completion of the project was now in the country and requested to be granted an opportunity to complete the project.

Legal advice was then sought regarding the way forward given the new development resulting in the matter being taken for arbitration.

“A pre-arbitration meeting was held with the contractor on 30 April 2018 where it was agreed the contractor would be given a chance to submit a proposal leading to the conclusion of the project. A proposal by the contractor was received at the Department of Works on 4 October 2018. In their proposal the contractor requested a price variation and a period of 45 days to complete the project,” Eng Moyo said.

He said the price variation requested by Synlak was for work they claimed to have carried out which was not included in the original contract.

“The proposal was considered, and a response was forwarded to the contractor through the chamber secretary’s office. The price variation was not acceded to for lack of merit. The proposal to complete the outstanding works in 45 days was acceded to. The contractor was then advised to indicate to council if they were still willing to proceed with the works and complete in the requested 45 days as per the terms of the initial Memorandum of Agreement. But the contractor insisted on a variation,” Eng Moyo said.