Government of the Federated States of Micronesia

Status of Pohnpei Water Supply and Sanitation Project Per National Planner June 1997 Report

PALIKIR, Pohnpei (FSM Information Service): July 31, 1997 - In his June 1997 monthly report, the National Planner stated that the authorizing legislation for the financing agreement has not been introduced in the Legislature due to some concerns over some wording of the security clause which attorneys are attempting to incorporate provisions to require Pohnpei Utility Corporation to provide cash security for the loan from the State to the Corporation.

With several meetings held between the Vice President, Pohnpei State Governor and the Speaker of Pohnpei Legislature it was concluded that the draft legislation would be introduced during the week ending July 11, 1997.

In the State of Kosrae, it was reported that so far there is no indication when and whether Kosrae Legislature will enact the necessary legislations. One aspect which Kosrae Utility Authority (KUA) objects to is the provision giving the State Government the right to reduce amount of compact energy grant which is passed on to the KUA, which would force KUA to rely more on its revenues.

The continued delay by the Kosrae Legislature in enacting necessary legislation may mean that Kosrae could be left out of the ADB Project and will become ineligible for funding from other external funding agencies for water and sewerage development.

The bid evaluation has recommended that contract for drilling rigs for Chuuk and Yap are awarded to Dando Drilling International of England for a contract price of $501,134. However, a contract for drilling rigs cannot be awarded until the ADB loan is declared effective. If the bank agrees that the project can proceed with only one state, it is planned to award the contract for drilling rig for Chuuk State before expiry of the bid validity period of July 23, 1997, and to request the Supplier to extend the bid validity period for Yap drilling rig by one month, the report stated.

The proposed effectivity of the projects in each of the four states were July 11, 19997 for Chuuk State; July 30 for Pohnpei; August 31st for Yap and September 30th for Kosrae.

Procurement and delivery schedule for drilling rig in Chuuk and yap is November 7, 1997. While the schedule completion of well drilling in Yap is June 4, 1998, and in Chuuk on November 25, 1998.

All engineering designs are scheduled for completion by march 15, 1998, the civil construction work for Pohnpei is scheduled for completion in February, 1999; Chuuk, Yap and Kosrae by December 8, 1999, the report stated.

For further information on this release, please contact:

FSM Office of the President
Public Information: Press, Radio, Video
P.O Box 34
Palikir Station, Pohnpei, FM 96941
Tel.: (691) 320-2548/2092
Fax.: (691) 320-4356