The NEWS (Monrovia)
7 March 2008
Monrovia — Opposition politician Dr. Togbah Nah Tipoteh says the Liberian government should have determined the capacity of the preferred bidders of the western cluster in full and on time before announcing the winner of the bidding process to the world.
He said when the President announced to the world that Delta Mining Company (DMC) had won the bid; it meant that the bidding process was over, as in the end of a football game when the winner is declared.
Dr. Tipoteh pointed out that the announcement to the world of the winner of the bidding placed the winner at an advantaged position, from which a stance is taken to obtain capacity for the Western Cluster mining as well as acquire a relatively better bargaining position in the world market.
Dr. Tipoteh's position was contained in a rebuttal article issued yesterday in Monrovia. His statement is an anti-thesis to a supplement published in the local dailies by the Inter-Ministerial Mineral Technical Committee (IMMMTC) which had rebutted a previous statement by Dr. Tipoteh.
The Liberian government, through the Ministry of Lands, Mines and Energy took exceptions to Tipoteh's concerns in a rebuttal claiming that it acted in accordance with law and policy relying on the Public Procurement and Concession Act.
The government counter argued that due diligence according to the Public Procurement and Concession Act is a "post-evaluation activity". And therefore following the announcement that Delta has won the bid for the western cluster with an indicated potential investment of US$1.6 billion, it was now time that the due diligence be applied on the companies.
However, in his reaction, Dr. Tipoteh explained that due diligence in the "post evaluation activities" might well end up validating the advantaged winner of the bidding who might have lacked capacity in the beginning, thereby strengthening the winner's bargaining or negotiations position to the extent of generating project delays here when higher priority has been given by the winner to an alternative project within the world market context.
According to him, such delays are now being experienced with Mittal Steel, resulting in the government taking some compromising stance to "woo" Mittal into getting really started as pressures for jobs are mounting daily.
"Why would the winner of the bid be announced to the world when the bidding is not over, according to your own definition. If the bidding were over, in your own determination, you would not continue to refer to competitors as bidders in what you call your "post evaluation activities". As with post-conflict, meaning after the conflict, post-evaluation means after the evaluation. So why do due diligence, which is an "evaluation" of capacity when you have determined that the evaluation is over and you even have the evaluation report as center piece of your post-evaluation activities?" the opposition asked.
Dr. Tipoteh: "You contend that the Law requires you to "First evaluate and determine the most responsive bidders, then do due diligence". Let us say that you proceed with the due diligence and none of the participants has the desired capacity, what do you do? Do you try to erase the worldwide impression that DMC is the best company to mine the Western Cluster deposits?"
According to the opposition politician, nowhere in his position did he condemn the Liberian government for announcing the winner of the bidding process, as indicated by the IMMTC. Dr. Tipoteh said he simply disagreed with the government, which does not suggest condemnation.
"I never said that Delta should not have been selected. I said that any announcement of a winner and then go into "due diligence" is a fundamentally flowed process, requiring revisitation," he noted.
Continuing, Dr. Tipoteh said his position remains the following: "the government should determine the capacity of the preferred firm "to make the stated investment in full and on time" before announcing the winner of the bidding process to the world. The center-piece of your argument is based on the President of Liberia's reference to "due diligence" as indicated in the quote provided by you, when she said in her 2008 Annual Message: "I am pleased to report that after a vigorous and professional exercise involving the work of seven government entities, the Delta Mining Consolidated Ltd. (DMC) of South Africa has won the bid for the Western Cluster with an indicated potential investment of US$1.6 billion. The process now moves to the next stage of validation that will undertake due diligence of all major bidders to determine their capacity to make the stated investment in full and on time" It is essentially upon the recommendation of the IMMTC that the President made the announcement about DMC in her Annual Message."
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It is common knowledge that individuals or entities planning to participate in any bidding of the size and complexity of the one under discussion must definitely be prequalified to determine their capacity or suitability.
Would it be the pre-qualification process that the government went through with the bidders? If it is not, then I find it difficult to understand why they would do it otherwise.