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Wednesday 21 November 2018
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$42M WATER TAXI BILL

Nidco pays Cadiz partnership for maintenance

Stephen Cadiz
Stephen Cadiz

 

The National Infrastructure and Development Company (Nidco) paid SVF International and its local partner, SVF TT, $42 million to maintain the vessels on the water taxi service from August 1, 2013 to November 21, 2017.

SVF TT is linked to a company in which former transport minister Stephen Cadiz had a shareholding.

Most of the invoices appear to be for replacement parts and servicing. Invoices that specifically mention works directly to the engine amounted to nearly $6.9 million, including a $1.75 million purchase and installation of a new MTU Reman Engine for the Carnival Runner.

In a 148-page report dated May 29, 2018, and addressed to Stuart Young in his capacity of Minister in the Ministry of the Attorney General and Legal Affairs, Nidco, which operates the water taxi service (WTS), has to date paid SVF International $2.09 million, and SVF TT $40.2 million. The report focused solely on SVF International and SVF TT, specifically the shareholding of each company.

SVF International, based in Curacao, are agents for German marine engine manufacturer MTU Friedrichshafen GmbH, which powers the water taxis. In November 2014, SVF International formed a joint venture company with local partners Tropical Power Ltd–SVF TT. Since then, SVF TT has overseen the maintenance of all four vessels of the water taxi fleet.

Nidco acknowledged in its report that since the formation of the joint venture company, it has noted that “there has been an improvement in the access to technicians but the delays suffered in the past continue to affect them (the water taxi vessels).”

In March, passengers had to be rescued when one of the vessels broke down off the coast of Maracas, en route to Port of Spain, after one of the engines caught fire.

Nidco’s maintenance staff have also been trained so many of the internal jobs can be handled internally. “Additional training is still required at this stage,” the company said.

Each water taxi has four MTU engines, totalling 16 for the entire fleet. The Galleons Passage, for which Nidco will have responsibility when it eventually arrives, has another four. MTU only operates through its local agents, so any requests of deliveries for parts are only facilitated through the authorised agent—SVF TT.

Despite the improved performance, Nidco reported a “red flag” because one of the original directors of Tropical Power Ltd, Stephen Cadiz, had been minister of transport when SVF TT’s tenure as MTU’s local agents began. Cadiz was transport minister under the previous administration from September 6, 2013 to June 17, 2015, and as such would have been line minister for the WTS.

The connection was first raised in public during a People’s National Movement rally in Barataria on June 7 by Finance Minister Colm Imbert. Imbert referenced Nidco’s report also citing the “red flag.”

“That company got the contract to maintain the engines for the water taxis, an activity under the Ministry of Transport while he (Cadiz) was the minister,” Imbert had said then. SVF TT is also supposed to maintain the engines for six of the Coast Guard’s fast patrol craft, he added.

Sunday Newsday asked Young if he had indeed received the report from Nidco, and if Government would act on it. He responded: “A report has been submitted to me by Nidco on the request of the Minister of Works and Transport. The report will be perused and should it require an investigation or further investigation, then same will be pursued. At this time, it would be prudent for me to refrain from any further comment.”

Taxis docked: Two water taxis in dock at King's Wharf, San Fernando. Nidco paid $42 million in maintenance fees to a joint venture company with links to former transport minister Stephen Cadiz. FILE PHOTO

Where’s the contract?

According to Cadiz, however, there is no contract between SVF TT and Nidco.

“All I can say is between November 2014 and September 2015 (SVF TT had) absolutely no contract with Nidco. There is still no contract with Nidco,” Cadiz told Sunday Newsday.

The relationship was “as required,” he described it, where Nidco would call and request a service or quotation for work to be done.

“They apparently only called when there was an issue they couldn’t handle. They have their own technical and maintenance staff. There may come a time when a problem would occur on the engine that requires further expertise,” he said.

Imbert, he said, was misinformed. “He specifically speaks to us maintaining the six Coast Guard vessels. We have no contract with Nidco and none with the Coast Guard. SVF TT has not done any work for the Coast Guard,” Cadiz said.

Tropical Power, in which Cadiz has an interest, is the minority shareholder in SVF TT. While he was minister, Cadiz had recused himself from the company's operations.

“SVF came to Trinidad and were interested in getting another company to partner with. They had the pick of the field. They did their own investigations and chose Tropical Power,” Cadiz said.

Engine agent timeline

The WTS was launched in 2008, and during that time the vessels, including its engines, were under a two-year warranty, maintained by the suppliers, Austal Ships Pty Ltd, of Australia.

Until 2010, the WTS did not directly interact with the local agents, Nidco said in its report. MTU’s agent at that time had been Compression and Power Services (1988) Ltd.

During the warranty period, Austal had complained to MTU that there were delays in the completion of maintenance tasks by the local agent. The agent was changed to Trintrac Ltd in February 2010. Trintrac, Nidco noted, was also late with delivery.

After persistent problems with delays for the supply of critical spare parts for the engines, the WTS, which by this time had taken over the maintenance of the vessels, attempted to source the parts themselves from an American company, Marenco International Trading Inc.

MTU however, only operates through its local agents in relevant countries, and advised Marenco to deal with SVF International. In 2013, because of Trintrac’s delays, MTU changed its local agent to SVF International. Since SVF International was based in Curacao, because of the distance from TT, its Venezuelan office supplied the WTS. This again proved to be complicated because of delays in deliveries, as well as availability of technicians.

Austal stepped in and was granted approval from MTU to purchase parts directly through them in order to supply the WTS; this arrangement continued until 2015, when Austal left that March.

By that time, though, SVF International sought to overcome the distance problem between TT, Venezuela and Curacao. They partnered with Tropical Power, and in 2014, created SVF TT, the local agents for MTU engines since then.

 

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