Mera says Terrastone contract for office complex on hold over corruption claims

Malawi Energy Regulatory Authority (Mera) board has said the siging of a K6.8 billion contract to Terrastone Limited to construct a Mera office complex  will only be done once all issues regarding payment of management fees are resolved with the project managers.

Bishop Joseph Bvumbwe, Chair of MERA: Contrcat will be signed later
Bishop Joseph Bvumbwe, Chair of MERA: Contrcat will be signed later

The statement has been made by Mera board chairperson Bishop Joseph Bvumbe following Malawi News report that Terrastone Limited has refused to give an alleged bribe to Acting Chief Executive Officer Ishmael Chioko who is said to have demanded such for the continuation of the project.

Bvumbwe said the  the delay in  signing the contract was firstly due to the fact that there was a restriction order obtained by the Anti Corruption Bureau (ACB) on allegations that suspended CEO Ralph Kamoto allegedly received money amounting to 400,000 USD from Terrrastone to influence the awarding of the contract.

The statement says the board wanted to allow ACB to do its job and instructed its lawyers not to object to an extension of the restriction order.

However, the statement alleges that Kamoto gave different instruction to the lawyers to object the restriction order by the ACB of which the lawyers successfully did.

Meanwhile,  Terrastone has written a protest letter to Mera and threatened to report Chioko to the ACB claiming that he was soliciting birbes.

In a letter  dated October 24 2016 addressed to Chioko with a copy sent to Mera’s board chairperson Bishop Bvumbwe, Terrastone Limited Managing Director Jose Da Costa  claims  Chioko invited Da Costa to meet him “at a neutral place” which happened to be the Presidential Hotel at city centre in Lilongwe.

“You told me at the meeting that we should work together and that I should assist you if the contract is to run smoothly. I did not understand this and when I asked what you meant you said the owners of the project are not happy not to have something for themselves out of this project,” says Da Costa in the letter.

On Chioko bribery claims, Bvumbwe said the matter can only be handled by other relevant authorities and that the board would come in at a later stage to “make an appropriate decision.”

“MERA thought it prudent that before the contract is finalised and signed with Terrastone, all outstanding issues with the project managers should be resolved first to ensure smooth supervision of the project once the construction starts,” Bvumbe said.

The MERA office complex scandal also involved ACB boss  Lucas Kondowe after allegation were made that he wanted to influence the contract be taken away from Terrastone and be given to Sogecoa.

Kamoto claimed in a letter to Attorney General that Mera invited and obtained bids for the construction of the office complex and obtained a ‘No objection’ from the director of Office Public Procurement (ODPP) to award the contract to Terrastone.

But he said a senior officer of the ACB told him to cancel the award and give it to Sogecoa.

He further indicated that the ACB senior official kept on harassing him by constant telephone calls between April 15 2016 and April 26 2016.

Said Kamoto: “He called me to meet him on April 26 2016, when the ACB issued a restriction notice, stopping the contractor and Mera from proceeding with the construction works.”

He said the ACB argued that they had received a complaint that Kamoto had “unilaterally awarded the contract” and asked for all relevant documents for the procurement.

But ACB’s Kondowe said the controversy over the Mera contract dates back to two or so years ago when the first tender on the contract was won by SR Nicholas before it was cancelled.

He explained that when the effort to build the office complex was revived, Mera sought advice from ACB on whether SR Nicholas can participate in the subsequent tendering of the project as Mera had heard that ACB was investigating the construction companies.

Kondowe said he advised Mera that there was no reason to deny SR Nicholas an opportunity to participate in the bid because the ACB investigations had not been concluded.

He said whistle blower  tipped ACB that the subsequent (tendering) process, where Terrastone won the contract, was not done fairly.

“There was an allegation of money changing hands and a few days later  we received another letter from Sogecoa also complaining about the tender process so we said let’s look into it. Let’s understand what happened,” Kondowe is on record saying.

Chioko was appointed Mera’s acting CEO after Kamoto was removed to pave way for investigations. But Chioko himself was arrested on October 21, 2014, for being a suspect of Money Laundering contrary to Section 35 (1) of the Money Laundering, Terrorist Financing and Proceeds of Serious Crimes Act in relation to cashgate.

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7 years ago

The fact of the matter is there is some one who is controlling all these events and that someone knows the truth. this fight is about money. it is about supremacy but a friendly warning to Bishop you are not a construction expert. and you have never been mark my words. to chioko. you caused trouble when you were in IPC at the same institution regards contract to SR Nicholas be aware that this world has eyes. are you sure if we do a play back of surveillance cameras we wont see you with da costa. do you think da… Read more »

7 years ago

Mr. Bishop chairing and maybe protecting suspects of corruption on an excuse that they are not convicted.
Mudzayakha mu khoti lopanda ziphuphu lija malalikira lija.

7 years ago

Terrastone ndi choncho olo kuti amange RBM ya ku Blantyre, gavanala wa nthawiyo anamumangira cottage pafupi ndi Sun n Sand

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