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Aug 30, 2012

No quick fix for Gautrain ‘megaclaim’ as Bombela, govt gather global experts

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Murray & Roberts CEO Henry Laas discusses Bombela's claim against the Gauteng government on the Gautrain project. Camerawork: Nicholas Boyd. Editing: Darlene Creamer. Recorded: 30/08/12.
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The delay and disruption claim the Bombela consortium had filed against the Gauteng government regarding the Gautrain project was unlikely to be “settled in the short term”, said Murray & Roberts CEO Henry Laas on Thursday.

Murray & Roberts is a member of the Bombela consortium, which built, and was now operating the R26.4-billion Gautrain rapid rail system on government's behalf.

Bombela had submitted its statement of case regarding the delay and disruption it said it had experienced in construction work on the public-private partnership project, as well as related disputes, to the Gauteng government on July 29, 2011.

The consortium said one of the issues was, for example, that the land on which construction had to take place was not provided by the province as scheduled.

Laas said the arbitration case was a complex one, with global expert witnesses being gathered on Bombela’s, as well as the provincial government’s side.

He noted that the claim was “a megaclaim”, “with not hundreds of millions, but billions of rands at play here”.

Laas said Murray & Roberts was focused on resolving the claim by December 2014.

Arbitration on another, smaller case regarding the Gautrain was scheduled for September.

This case related to the volume of water ingress in the tunnel between the Rosebank and Park stations, which had delayed the opening of this leg of the route from August last year to June this year.

Laas said it was “common knowledge” that the Gauteng government and Bombela viewed the water matter differently.

Even through arbitration on the matter was scheduled for September, Laas only expected a ruling at the end of this year.

“We are confident we have a reasonable case.”

However, he warned that the outcome was not certain, and that there could still be “a potential cost risk to Murray & Roberts”.

Another major project where Murray & Roberts had to turn to arbitration in recent months, had been the troubled Gorgon Pioneer material offloading facility (GPMOF), in Australia.

The cash outlay of more than R2-billion on the project over the past 16 months represented one of the largest single cash losses for the company in recent times.

However, Laas said on Thursday that arbitration rulings on the first three disputes over the GPMOF, relating primarily to scope changes from the tendered design, had been awarded in its favour.

He said the quantum of restitution would be determined through further arbitration, and that the company could “see cash flow” during November or December 2012.

Laas said he expected more disputes on the GPMOF project to be ruled in Murray & Roberts’ favour now that the company has won the design dispute.

“What we built was different from what we tendered,” he noted.

 


 

Edited by: Creamer Media Reporter
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