The raging dispute between UNRA and AECO stems from the construction of Tirinyi-Pallisa-Kumi/Pallisa-Kamonkoli road in eastern Uganda and Masindi Kisanja-Tangi-Paraa-Buliisa road, one of the oil roads in the country’s mineral-rich Graben region.
AECO won the contracts to supervise engineering designs and building works for both road projects but has since fallen out with UNRA, the implementing agency, over alleged breach of contract and corruption.
AECO however, faults UNRA for the fallout. Interviewed for a comment, UNRA spokesman Allan Sempebwa told The Observer that he was not aware of the on-going dispute between UNRA and AECO. He requested for some time to crosscheck with the projects team for details.
According to several letters and documents seen by this paper, the dispute may cost the Ugandan taxpayer millions of dollars in compensation and payment for sub-standard work.
The dispute has also frustrated another government project to construct Pallisa, Kumi and Iganga town roads. The Islamic Development Bank, which funded the Tirinyi-Pallisa-Kumi/Pallisa Kamonkoli road with a loan of Shs 489 billion, rejected another loan request from government to finance the Pallisa, Kumi and Iganga town roads.
The government asked for a loan of $35 million or Shs 124,417,930,000 to construct the roads in the aforementioned towns in eastern Uganda. However, in their April 18, 2021 letter to the minister of Finance (and copied to UNRA director Allen Kagina), the Islamic Development Bank’s regional hub manager Dr Issahaq Umar Iddrisu pegged the loan approval to first getting the review of the Tirinyi-Pallisa- Kumi/Pallisa-Kamonkoli road works.
Iddrisu said the review must be done by the contracted external independent supervision consultant, who is AECO and their Ugandan Partners, Professional Engineering Consultants (PEC), the local sub-contractors.
Egyptian firm, Arab Contractors Ltd, is the main contractor for the 111.25-kilometre Tirinyi- Pallisa-Kumi/Pallisa Kamonkoli road.
It is understood that UNRA deployed its engineers to supervise the Tirinyi-Pallisa-Kumi/ Pallisa Kamonkoli road works at the expense of AECO until March, 2021, six months before the scheduled completion of the project.
UNRA’s move to deploy its engineers contradicted the loan agreement signed with the Islamic Development Bank in which the agency indicated they hired an external independent supervision consultant to supervise the road design and construction works.
According to documents, AECO signed the contract with UNRA on November 16, 2019 after being declared winners through a competitive bidding procurement process. UNRA wrote on November 7, 2019, announcing AECO’s winning bid.
But in a rather bizarre move, UNRA delayed to sign the contract for 16 months while construction works progressed without allowing AECO on site. It is worth noting that the Solicitor General cleared the procurement process on October 21, 2019.
On December 26, 2019, AECO Director Wail Abuljbain wrote to UNRA protesting the delay. He demanded that UNRA allows his company to start work but was ignored until mid-March, 2021.
OVERPAYMENT
On getting the final contract, which UNRA signed on March 15, 2021, AECO learnt that the design review component had been deleted. They however, opted to go ahead with the supervision.
And in one of their first checks, AECO engineers discovered substandard work on some sections of the road and discrepancies in payments of staff, which led to an overpayment of $2.5 million to the contractor (Arab Contractors). The overpayment query is contained in two separate letters that AECO boss, Abuljebain, wrote on August 7, 2021, to Engineer Mohamed Tolba, who is Arab Contractors’ regional representative.
“The purpose of this letter is to inform you that the said discrepancies will be reflected in your next certificate,” Abuljedain wrote in his letter, copied to the Islamic Development Bank and UNRA officials.
Based on the above discrepancies, AECO refused to sign off a completion certificate for the Tirinyi-Pallisa-Kumi/Pallisa-Kamonkoli road. The Kuwait-based firm demanded that UNRA should keep the contractor (Arab Contractors) on site and allow AECO engineers do the value-for-money tests on the entire 111.25-kilometre road.
MASINDI-BULIISA ROAD
Meanwhile, through their lawyers, OSH Advocates and Kampala Associated Advocates, AECO have filed a claim amounting to $ 5 million before the arbitration panel after UNRA terminated their contract on the Masindi Kisanja-Tangi-Paraa-Buliisa road.
In November 2018, UNRA awarded the supervising contract to AECO, with China Communications Construction Company Limited (CCCC), as the main contractor for the 159-kilometre road, which is nearing completion soon.
In almost similar fashion, the working relationship between UNRA and AECO soared over supervision and altered road designs. This culminated into UNRA terminating AECO’s contract on August 19, 2020.
UNRA replaced AECO with PROME Consultants, a local firm, which had earlier been sub-contracted by the Kuwait firm as their local partners on the project.
In the termination letter, UNRA stated that AECO failed to mobilize staff, make monthly reports and refused to approve the contractor (CCCC)’s submissions and instructions in time, among others. AECO dismissed all UNRA’s reasons as lies, and petitioned President Museveni.
MEETING PRESIDENT
On getting the petition from AECO directors, the president urged UNRA to salvage the situation. Last week, on October 21, 2021, the AECO team led by Abuljebain met President Museveni in Kampala. After listening to the AECO delegation, the president directed UNRA executive director Allen Kagina to allow AECO engineers to check the Tirinyi-Pallisa-Kumi/ Pallisa-Kamonkoli road.
On the contractual issues for the Shs 770-billion Masindi-Buliisa oil road, the president advised UNRA to settle the matter amicably to ensure AECO does not file the $5 million dollar claim.
By the end of the week, UNRA officials insisted on urging Arab Contractor to remove their equipment from Tirinyi-Kamokoli road site to thwart AECO’s technical check-ups on the entire road. And without any breakthrough, AECO officials went ahead and filed their claim to the arbitration panel on October 25 after five days of back-and-forth movement.