Enron seeks in-depth review of bids

A company closely competing for the new power plant on Saipan has called for a comprehensive reevaluation of all proposals submitted for the $120 million project, including the “best and final offers” handed in during the initial review conducted last year by the Commonwealth Utilities Corporation.

David Howe, vice president of Enron International, urged CUC to allow a private engineering firm tasked to independently review the bids to undertake a “thorough analysis of the process, from start to finish.”

Burns & McDonnell, a Kansas-based firm, is currently reevaluating all 13 proposals and a preliminary report was scheduled to be presented to the CUC board yesterday.

Board directors are expected to discuss the findings in a meeting today in which they may decide whether to hire the company for a second round of review to make final determination on which firm will be contracted to build the 80-megawatt power plant.

In a letter to CUC chairman Juan S. Dela Cruz, Enron said the “best and final offers” required by the government-owned utility firm from top-wrung bidders were more detailed than their original proposals.

“(W)e urge CUC to include a complete evaluation of all proposals, including best and final offers,” Howe said in the letter.

“This is the only way to determine if the best and final offerors have met or have not met all the (request for proposal) requirements and which one is truly the best,” he added.

Enron emerged on top during the firs round of review conducted by CUC last year, but trailed behind Marubeni Corp. of Japan and its U.S. partner Sithe Energies, Inc. in the final round, which won the contract.

But the CUC selection process has drawn protest from the Texas-based industrial firm and a consortium of Alsons, Tomen, Singapore Power and Tan Holdings Corp., prompting the public auditor to step in and order a fresh review by an independent firm.

The project, touted to be the largest deal ever in the CNMI, will be constructed through the build-operate-transfer scheme to meet increasing power demand on Saipan by the end of the decade.

According to the Enron official, the final proposals they submitted last year during the last round of review had addressed concerns of the utility corporation on environmental requirements as well several local and federal regulations.

“This must be thoroughly reviewed by the independent evaluator,” Howe explained, “otherwise, CUC might suffer a severe financial impact if the selected offeror were in fact unable to comply with… guidelines.”

He maintained that a full review by Burns & McDonnell will allow a determination of which among the proposals provide a better deal in terms of engine technology and fuel consumption — areas that were included in the final offers.

“The independent reviewer needs to be given a free hand to conduct a thorough and technically competent analysis. In the end this approach will expedite the selection process and provide the credibility that the process deserves,” Howe added.

Under the agreement with Burns & McDonnell, the firm would establish a “competitive range” among the various proposals and a second round may be optioned by CUC if board members decide to conduct a final determination of the project contractor.