$1.3M OK’d to extend Aggreko contract, pipeline installation

The Commonwealth Utilities Corp. board of directors has approved the CUC management’s request for the transfer of $1.3 million needed to pay for a 90-day extension of the original $1.5 million 90-day contract that CUC has with Aggreko.

CUC executive director Gary P. Camacho said the board approved the release of the $1.3 million for use to extend the Aggreko contract and also to install a fuel pipeline.

Aggreko has been hired to provide a temporary electric power supply while CUC’s engines are down for overhaul and repair.

Of the $1.3 million, $43,000 will be allocated to install a fuel pipeline from CUC’s Power Plant 1 in Lower Base to the nearby Aggreko engines, Camacho said.

Camacho said that board members discussed the Aggreko extension and the pipeline during an executive session presided over by board chair Miranda V. Manglona last Thursday morning.

He said the board member then voted for the release of the $1.3 million. All board members were present at the meeting, except for Matthew Holley.

Camacho said the transfer of the money has something to do with addressing the emergency electric power supply on Saipan for lack of revenue due to non-payment from large accounts such as the Commonwealth Healthcare Corp.’s.

With Thursday’s board decision, the board now released a total of $7.3 million for the emergency repair and overhaul of power engines at Power Plant 1 and to pay for the Aggreko temporary electric power supply.

Last November, the board approved the release of $6 million from CUC’s $12 million restricted account reserved to buy a power engine to replace power engine number 8 at CUC’s power plant.

The $6 million was intended for the $1.5 million 90-day contract with Aggreko; $300,000 repair of engine number 6; $2 million for overhaul of power engine number 5; and $2 million for overhaul of power engine number 7.

CUC’s original plan was, once the Federal Emergency Management Agency reimburses CUC for the money it spent to enable it to recover from Super Typhoon Yutu, that $6 million taken from the restricted account will be replenished and that any used funds from that amount will also be returned to the restricted account.

Camacho brought up the importance of having the 90-day extension for Aggreko during the board meeting last Jan. 16. The meeting was continued last Thursday.
Under the contract, Aggreko was supposed to start producing power last Jan. 15. The next target date was last Saturday, Jan. 25.

Saipan Tribune was still verifying with CUC yesterday whether Aggreko already started producing power last Saturday.

At the Jan. 16 board meeting, Camacho said the original request they had put in for Aggreko was 90 days because that was the assumption from the power plant that the overhaul of the two power engines would be done in 90 days.