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Funding ceiling for CUC pipeline project increased to $8.5M
The federal court has approved a joint request by the CNMI and U.S. governments and the Commonwealth Utilities Corp. to increase the funding ceiling for the construction of the stalled CUC pipeline project to $8,482,161.
U.S. District Court for the NMI designated judge David O. Carter in the same order issued on Wednesday, also granted the parties’ request to increase the funding ceiling for task order 1 to $838,272. Carter’s order and the parties’ stipulation did not indicate the amount of the original funding ceiling for task order 1.
Task order 1 refers to Gilbane Federal’s activities such as providing construction management, oversight, and court required activities on CUC projects.
Gilbane Federal is a California-based construction company mandated by the federal court to expeditiously complete some stalled CUC projects.
With respect to the CUC pipeline project, last February, Carter approved the parties’ request to put a total funding ceiling of $4.6 million to the controversial project.
Last February, the U.S. Department of the Interior approved an additional funding of $2.6 million to complete the pipeline project. With such additional funds, DOI’s total funding for the project would then balloon to $8.1 million since the project was initiated in 2010.
Last Nov. 13, the CNMI government submitted an amended Fiscal Year 2016 Commonwealth Improvement Projects spending plan to DOI’s Office of Insular Affairs to include the $5 million funding requirement for Stipulated Order 2 (SO2) projects.
The $5 million FY 2016 grant funds will be used for the pipeline project $3,887,161, Gilbane Federal’s construction management (382,225), and for cleanup, inspection and repair of Tank 103 ($730,614). OIA is currently reviewing the grant applications for the SO2 projects.
The oil pipeline project is an 8-inch aboveground receiving pipeline that delivers diesel fuel from the Mobil oil facility to CUC Power Plants 1 and 2 in Lower Base. The U.S. Environmental Protection Agency had stated that until the pipeline is properly repaired or replaced, it poses a threat to the adjacent ocean.
SO2 projects refer to the decommissioning of the existing CUC pipeline and smart pigging of the new pipeline, waste management for Power Plants 1 and 2 on Saipan and Rota power plant, construction management, among others.
