Litro Gas open tender raises eyebrows

Best practices of government tender procedures have come into question over the recent open tender by state-owned Litro Gas for the supply of 250,000 metric tonnes of LP gas, Daily Mirror learns.

According to informed sources, the flouting of the tender procedures was largely aimed at favouring one of the bidders, a company of Singaporean origin, which had allegedly not fulfilled the tender requirements within the stipulated time frame.

For this Litro Gas tender scheduled to close at 3.00 p.m. on May 27, 2016, each selected bidder was asked to submit a bid bond of US$1 million along with the tender documents.

The submission of the bid bond amounting to US$1 million by 3.00 p.m. was specifically mentioned in the Litro Gas tender advertisement which appeared in a weekend English newspaper on April 24, 2016.

However, on the day of the opening of the bond, a Litro Gas tender board official had verbally announced that bid bonds amounting to US$1 million could be submitted till 4.30 p.m. leading to the assumption that it was the cut off time for the submission of bid bonds.

However, sources said despite the extended deadline, the Singaporean company in question, along with two other bidders, appeared not to have submitted bid bonds even by 4.30 p.m. on May 27, and the Litro Gas official had reportedly taken a personal interest in the said company submitting a bid bond along with the tender documents.

Interestingly, it was revealed that only this particular official had access to inspect the bid bonds submitted by the bidders despite there being several officials from Litro Gas and a representative from the Public Enterprise Development Ministry on the tender board.

According to general rules pertaining to tenders, if a bidder fails to provide all the required documents and financial commitments within the stipulated time period of the tender, their bid is deemed disqualified.

Sources said in case the Singaporean company had submitted a bid bond after the stipulated time it should therefore be disqualified.

They said the tender worthiness of such a bid bond, if there was any could be determined by checking the issue date and time of the bid bond with the issuer bank.

Meanwhile, in spite of the said tender being an open tender, Litro Gas tender board has declined to declare the price quotations of the each tenderer at the opening of the tenders.

Litro Gas tender board had reportedly told the tenderers that it was not company policy to declare prices and the bidders would be notified of the prices only once the tender was awarded, a promise made during a tender in 2015 too, but never honoured.

Thus, the move denied the opportunity for participating bidders to be aware of the lowest offer and thereby keeping provisions to introduce amended prices to tender documents.

The tender participants pointed out that even at the opening of the Defence Ministry tenders, which are obviously more sensitive in nature than LP gas, the prices are declared at the opening of the tenders.

However, despite the total suppression of information from their side, Litro Gas had reportedly insisted on each bidding party to disclose who their foreign principal was.

Meanwhile, the bidders charged that any proof of submission of bid bonds was not physically shown to bidders, who were entitled to know who had bid and who were the bidders going into the next round of evaluation.

A representative of one of the tender participants expressed his apprehension over the developments and said a Cabinet appointed tender board should evaluate the tenders to ensure transparency, given their scale and importance.

Attempts to reach Litro Gas Chairman Shalila Munasinghe or CEO Muditha Pieris to obtain a comment regarding the matter were not successful.