Soca Warriors Online Discussion Forum
General => General Discussion => Topic started by: Jumbie on September 13, 2012, 07:57:19 AM
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Saw this in the latest issue of Ships Monthly (September) (found a link online for you guys to check out if interested).
The Brazilian Navy has accepted the first of three Ocean Patrol Vessels from BAE Systems. The warship was handed over at Portsmouth on 29 June and renamed Amazonas (P120). Prior to delivery, 80 Brazilian sailors conducted two days of sea trials to familiarise themselves with the 90m OPV which, although already repainted in Brazilian colours, was still running under her original name of Port of Spain. Transfer of the Glasgow-built pair, Scarborough and San Fernando, will take place later this year and early in 2013, when they will be renamed Apa (P121) and Araguaia (P122), after national rivers.
The ships were originally built for the Trinidad & Tobago Coast Guard, but the order was cancelled in 2010 following a change of government when the vessels were close to completion. Brazil later acquired them for £133 million, a sum that also includes ancillary support services and a manufacturing licence to enable further vessels of the same class to be constructed in Brazil.
See: http://shipsmonthly.com/news/naval/735-brazil-bags-a-bargain-
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We could feel safe at the WC and Olympics. Seriously, the petty politics that our parties play truly impedes progress. Can't wrap my head around that at all
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I thought them ship was not good. It good 4 Brazil but not good 4 we.
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Doh worry, de water taxi's go protect we borders
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Shame on the Brazilian government for buying defective merchandise ::)
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Shame on the Brazilian government for buying defective merchandise ::)
I now coming to laugh at dem shithongs... BAE know which tree to climb ;D
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Doh worry, de water taxi's go protect we borders
:rotfl:
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Did the govt retrieve any monies from this transaction?
i really thought these people was good for T&T,they shoulda really stay in the counttry side planting garden and that educated fool of ah minister of national security, they shoulda leave he wid fifa.
as for manning, he is to blame for all ah this. this fackin dunce went and call election before he could get his house in order, he should have finished the railway and had the boats in port and working before he made such ah fack head move.
and allyuh does wonder why i does hate on my place of birth, them ppl dunce fackin bad bad!
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BAE settles dispute with Trinidad
Financial Times·4 hours ago BAE Systems on Wednesday reached a settlement in its two-year dispute with Trinidad and Tobago over a cancelled offshore patrol boat order. The settlement brings to a conclusion a disagreement that arose in 2007 .
Ah wonder for how much billions sss. and they would flat out deny it ot any settlement .
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£125m-£130m
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BAE settles dispute with Trinidad
Financial Times·4 hours ago BAE Systems on Wednesday reached a settlement in its two-year dispute with Trinidad and Tobago over a cancelled offshore patrol boat order. The settlement brings to a conclusion a disagreement that arose in 2007 .
Ah wonder for how much billions sss. and they would flat out deny it ot any settlement .
If we were to follow the trend that the AG set, they will say it have a non-disclosure clause and they cant comment on the amount, but we win the case anyway.
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There is no way the government could withhold the amount that they have to pay them regardless of what that agreement says.
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After cancellation of order for three OPVs.
Boat builders to pay T&T $1.3b
Published:
Thursday, November 15, 2012
Gail Alexander
Attorney General Anand Ramlogan speaks to reporters at a media conference at his Port-of-Spain office yesterday. PHOTO: ROBERTO CODALLO
Don’t mess with T&T. That was the message from Attorney General Anand Ramlogan yesterday as he announced that Government had emerged victorious with a $1.382 billion settlement from British Aerospace Engineering Systems (BAE) over the cancellation of an order for three Offshore Patrol Vessels (OPVs).
“Government has agreed to pay BAE not one red cent,“ Ramlogan added, announcing the settlement of the two-year dispute. Ramlogan said a diplomatic initiative by the British Government “bore fruit“ in favour of the T&T Government. The settlement, he said, was a significant precedent for T&T and created legal history by successfully standing up to one of the world’s biggest military defence companies.
Yesterday, in a brief statement, BAE said: “The settlement with the T&T Government is at an amount consistent with provisions held.” It said after the cancellation the three OPVs were subsequently sold to the Brazilian Navy under a contract signed in December 2011 and the first ship was handed over in June.
The London Financial Times reported yesterday that BAE had reached a settlement in the “long-running dispute with T&T.” It added: “The settlement brings to a conclusion a disagreement that arose when Trinidad cancelled an order for the three boats following cost overruns and delays.
“The decision in 2010 came so late in the development phase of the contract that one of the three boats was ready to be delivered, prompting BAE to take a £100 million charge.” The FT also quoted an analyst, Robert Stallard, as saying the deal “should be seen as a positive development because it reduced the company’s political risk.
He noted that by 2012 BAE had received about £130 million as a working capital inflow from Brazil and had carried a trade liability of £125 million in deferred income relative to the settlement. Stallard was reported as saying the settlement was likely to be for £125-£130 million.
“There should be a net nil result in the working capital for the year as we understand Brazil has already paid for the ships,” he added. A story in the Global Arbitration Review, however, quoted a similar number but in US dollars, not sterling. “BAE,” it said, “has today agreed to pay US$131 million to the Government of Trinidad and Tobago to settle ICC arbitration proceedings over a shipbuilding contract.”
At yesterday’s media briefing, Ramlogan, claiming vindication against his critics, said the arbitration with BAE took place in London in May, first on liability and then on the assessment of damages. Evidence was given by the AG, Commodore Garnett Best and Capt Mark Williams of the T&T Coast Guard. The agreement was reached on Tuesday.
Ramlogan added: “Subsequent to the arbitration hearing, which we thought went pretty well, a diplomatic initiative ensued under the auspices of the British High Commission and that initiative has borne fruit but not in the way some people thought it would. It has instead borne fruit in favour of the T&T Government.
“BAE, as per the settlement agreement, has agreed to pay the Government of T&T and the people of T&T the sum of $1.382 billion in settlement of the claim against BAE. “The Government of T&T has agreed to pay BAE not one red cent for their claim of over $600 million against Government.
“We are grateful to his Excellency (British High Commissioner) Arthur Snell for the diplomatic support he had provided to us in his efforts to settle this matter.” Ramlogan paid tribute to the legal team of Joe Smouha, Alan Newman, John Almeida (of Charles Russell LLP), Neena Poliah and others, including Jerry Hospedales,
He said there was no possibility of an appeal against the settlement since all parties had signed on the settlement agreement. The first payment towards the settlement will be over £100 million next January and a second payment next May. Because Government has paid off loans early, the State would have a windfall of $57.1 million which would have been interest payments on the loan, he added.
He said there would be further savings from the operational costs of the OPVs, whose recurrent costs would have been $32 million annually. Asked if the outcome meant the message on such issues was “don’t mess with T&T,” Ramlogan said: “Yes, it is.”
He added: “It has a very positive impact that T&T is about serious business and not a Third World banana republic. “It means for all international contractors, we will respect your contractual obligations and we want you to honour ours and if you don’t, we are prepared to stand up and stand our ground to deal with the matter, no matter how powerful you are.
“It also says to my critics they should think twice before they open their mouth to criticise or condemn. I’m very serious about my job.” Ramlogan slammed Opposition Leader Dr Keith Rowley, PNM MP Colm Imbert and other critics who said Government would lose the arbitration. He said an October 28 newspaper story on the issue was “completely false, baseless, entirely misconceived and lacking factual premise.”
The backstory
The vessels were ordered by the PNM administration in April 2007 in a total financial commitment of $2.192 billion. The PP Government cancelled the vessels four months after assuming office in 2010
Prime Minister Kamla Persad-Bissessar cited technical deficiencies and delays. She said damages of over $61 million were overdue and payable by BAE to Government and Government would become entitled to, among other things, a full refund of money paid to BAE for the undelivered vessels. BAE went immediately to arbitration, claiming $611 million from T&T. The Government countersued for $1.4 billion in damages.
Why the OPVs were cancelled
In September 2010 when Government announced the cancellation of the OPVs, the Prime Minister’s Office said the Government was exercising its contractual rights in cancelling the contract.
The office said the contractual rights were designed to protect the Government in circumstances where the Government was left with no other remedy and because of BAE’s serious and persistent delays and technical deficiencies, Government had concluded that it was in its best interests to exercise this right.
With a contract of this size and importance, and with major delays already announced, it was incumbent on the new Government to review the OPV project, the office said. Government said during the early months of 2010, concern had been raised over the capabilities of the OPVs combat system.
BAE, it said, had proposed Government take delivery of the defective vessels despite combat-system defects that might prejudice the vessels’ operational capability.
PNM CONFUSED
Confusing. That was PNM MP Colm Imbert’s take on the Government/BAE settlement. “It’s confusing. When you read the article on it in the Financial Times, it gives the impression BAE was successful in arbitration, and the AG is saying T&T was successful. So I won’t comment until I get to the bottom of this.”
Opposition Leader Keith Rowley, deputy leader Marlene McDonald and PNM PRO Faris Al-Rawi didn’t answer calls to their mobile phones. PNM MP Amery Browne said: “I’m seeking further facts on the matter. God knows the Treasury needs money.”
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Clyde shipyard bosses win £130m compensation battle
By Gordon Thomson (Evening Times)
CLYDE shipyard bosses have won a £130million compensation battle with high ranking government officials in Trinidad and Tobago.
The deal was thrashed out after the Caribbean republic reneged on an agreement to buy three offshore patrol vessels to be used in a crackdown on gun runners and drug smugglers.
The row was triggered when a newly-elected government decided to scrap the contract in October, 2010.
The contract had been worth £150m and had been placed with BAE Systems in April, 2007, by political opponents who had previously run the affairs of both holiday islands.
They had claimed there had been building delays to all three vessels and that the combat system had malfunctioned during sea trials on two of the ships.
The Trinidad and Tobago government refused to accept the patrol ships and instead BAE launched a compensation battle at an international court of arbitration.
It held a private hearing over several days in London in May and last month Cabinet members in the Republic were known to have approved a payment to BAE of £130m to end the row.
Shipyard bosses refused to disclose the sum involved but last night issued a brief statement to confirm both sides had reached an agreement.
It means BAE officials have almost doubled their money.
While the dispute rumbled on the company revealed in the run-up to last Christmas that it had sold the three vessels to the Brazilian Navy for £133m.
Company chiefs refused to comment further but industry sources last night confirmed that BAE was to be given £130m in compensation by the Trinidad and Tobago government whose senior officials could not be contacted.
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Well yes, so who really telling the truth?
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Well yes, so who really telling the truth?
you makin joke...allyuh go believe some internationally renowned british businessmen over we impeccably honest AG??
jack warner was right, yuh cyah truss anybody dat does eat haggis
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Boat builders to pay T&T $1.3b
Don’t mess with T&T. That was the message from Attorney General Anand Ramlogan yesterday as he announced that Government had emerged victorious with a $1.382 billion settlement from British Aerospace Engineering Systems (BAE) over the cancellation of an order for three Offshore Patrol Vessels (OPVs).
“Government has agreed to pay BAE not one red cent,“ Ramlogan added, announcing the settlement of the two-year dispute. Ramlogan said a diplomatic initiative by the British Government “bore fruit“ in favour of the T&T Government. The settlement, he said, was a significant precedent for T&T and created legal history by successfully standing up to one of the world’s biggest military defence companies.
Yesterday, in a brief statement, BAE said: “The settlement with the T&T Government is at an amount consistent with provisions held.” It said after the cancellation the three OPVs were subsequently sold to the Brazilian Navy under a contract signed in December 2011 and the first ship was handed over in June.
The London Financial Times reported yesterday that BAE had reached a settlement in the “long-running dispute with T&T.” It added: “The settlement brings to a conclusion a disagreement that arose when Trinidad cancelled an order for the three boats following cost overruns and delays.
“The decision in 2010 came so late in the development phase of the contract that one of the three boats was ready to be delivered, prompting BAE to take a £100 million charge.” The FT also quoted an analyst, Robert Stallard, as saying the deal “should be seen as a positive development because it reduced the company’s political risk.
He noted that by 2012 BAE had received about £130 million as a working capital inflow from Brazil and had carried a trade liability of £125 million in deferred income relative to the settlement. Stallard was reported as saying the settlement was likely to be for £125-£130 million.
“There should be a net nil result in the working capital for the year as we understand Brazil has already paid for the ships,” he added. A story in the Global Arbitration Review, however, quoted a similar number but in US dollars, not sterling. “BAE,” it said, “has today agreed to pay US$131 million to the Government of Trinidad and Tobago to settle ICC arbitration proceedings over a shipbuilding contract.”
At yesterday’s media briefing, Ramlogan, claiming vindication against his critics, said the arbitration with BAE took place in London in May, first on liability and then on the assessment of damages. Evidence was given by the AG, Commodore Garnett Best and Capt Mark Williams of the T&T Coast Guard. The agreement was reached on Tuesday.
Ramlogan added: “Subsequent to the arbitration hearing, which we thought went pretty well, a diplomatic initiative ensued under the auspices of the British High Commission and that initiative has borne fruit but not in the way some people thought it would. It has instead borne fruit in favour of the T&T Government.
“BAE, as per the settlement agreement, has agreed to pay the Government of T&T and the people of T&T the sum of $1.382 billion in settlement of the claim against BAE. “The Government of T&T has agreed to pay BAE not one red cent for their claim of over $600 million against Government.
“We are grateful to his Excellency (British High Commissioner) Arthur Snell for the diplomatic support he had provided to us in his efforts to settle this matter.” Ramlogan paid tribute to the legal team of Joe Smouha, Alan Newman, John Almeida (of Charles Russell LLP), Neena Poliah and others, including Jerry Hospedales,
He said there was no possibility of an appeal against the settlement since all parties had signed on the settlement agreement. The first payment towards the settlement will be over £100 million next January and a second payment next May. Because Government has paid off loans early, the State would have a windfall of $57.1 million which would have been interest payments on the loan, he added.
He said there would be further savings from the operational costs of the OPVs, whose recurrent costs would have been $32 million annually. Asked if the outcome meant the message on such issues was “don’t mess with T&T,” Ramlogan said: “Yes, it is.”
He added: “It has a very positive impact that T&T is about serious business and not a Third World banana republic. “It means for all international contractors, we will respect your contractual obligations and we want you to honour ours and if you don’t, we are prepared to stand up and stand our ground to deal with the matter, no matter how powerful you are.
“It also says to my critics they should think twice before they open their mouth to criticise or condemn. I’m very serious about my job.” Ramlogan slammed Opposition Leader Dr Keith Rowley, PNM MP Colm Imbert and other critics who said Government would lose the arbitration. He said an October 28 newspaper story on the issue was “completely false, baseless, entirely misconceived and lacking factual premise.”
Source: http://www.guardian.co.tt/news/2012-11-15/boat-builders-pay-tt-13b
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i wouldnt be surprised..somthing about how the stories came out wasnt making any sense...and yesterday ramlogan said in due time he will contact international media to tell them to correct their story...like the thing aint finish cook yet..
BAE, Govt in secret deal for more boats
Published:
Friday, November 16, 2012
Text Size:
Attorney General Anand Ramlogan
Although the Government is claiming to have won an arbitration battle with British Aerospace Engineering Systems (BAE), one of the world’s largest military defence companies, indications are that a secret deal between the parties is in the works for T&T to acquire several second-hand boats. “Information is there may be a secret deal going on between the Government and BAE for the purchase of second-hand military vessels,” a well-placed source, requesting strict anonymity, told the T&T Guardian yesterday.
“Reports are that BAE leased the vessels to another country and the lease came to an end. If it is true the Government plans to buy these second-hand vessels from BAE, it means there is some deal going on in conjuction with the arbitration,” said the source. “There may be more to the $1.382 billion settlement the Government got from BAE. There may be far more to the story than we think,” the source said.
Attorney General Anand Ramlogan, contacted for a response on the matter, only said, “Talk to National Security Minister Jack Warner. I don’t want to comment on matters that concern his ministry.” Meanwhile, the Opposition PNM is likely to contact BAE in a bid to get more information on the arbitration matter, which it says is “very confusing and contradictory.”
PNM MP Colm Imbert was a member of an inter-ministerial committee for the purchase of military assets (the OPVs) in the last administration. Asked if he had contacted BAE on the current issue, he replied, “I have not contacted them as yet.”
Imbert said he is not satisfied all the information on the BAE settlement coming from the Government is correct and he’s checking to make sure all the facts are in order. He said reports from the international press are different from those coming from the Government. “The international press is saying BAE won the arbitration and was paid by the Government. The Attorney General is saying these reports are a fabrication.”
Further compounding the confusion is the question of the real cost incurred by the Government in the OPV matter, Imbert said. “The legal costs are significant, but they pale in comparison to the costs incurred in training Coast Guard officers to use the vessels, and other costs, as well. Research leaves me to believe the AG is not talking about a lot of expenses the Government can’t recover. “But any objective assessment of the costs must include all expenses. It’s far more than is being indicated by the Government,” said Imbert, who is promising to reveal more details soon.
The Financial Times report on Wednesday said BAE must have been relieved at the settlement. “The settlement brings to a conclusion a disagreement that arose when Trinidad cancelled an order for the three boats following cost overruns and delays. “The decision in 2010 came so late in the development phase of the contract that one of the three boats was ready to be delivered, prompting BAE to take a £100 million charge. “Even so, the settlement will come as a relief to BAE, which has been under pressure from investors. BAE said the settlement was ‘at an amount consistent with provisions held.’”
http://www.guardian.co.tt/news/2012-11-15/bae-govt-secret-deal-more-boats (http://www.guardian.co.tt/news/2012-11-15/bae-govt-secret-deal-more-boats)
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Something is rotten in the state of Denmark...
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Did we get back all we money?
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OPV DEAL EXPOSED
How T&T brokered an agreement with BAE Systems• AG negotiated for $400 million more for a total of $1.382 billion• Coast Guard commander expressed his reservations since 2008
By Asha Javeed asha.javeed@trinidadexpress.com
Story Created: Nov 17, 2012 at 10:51 PM ECT
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Story Updated: Nov 17, 2012 at 11:33 PM ECT )
In a David-versus-Goliath-like battle, which was Trinidad and Tobago against the UK firm British Aerospace Engineering (BAE) Systems in legal arbitration, this country emerged compensated.
The legal "victory" means T&T could pay the balance of the $2 billion loan, which it had secured to embark on the project to purchase three offshore patrol vessels (OPVs), which spanned three years and concluded when the People's Partnership Government cancelled the order from the UK firm in September 2010.
There has been the argument that the settlement of $1.382b was simply a refund equivalent to the sum paid by the Brazilian Navy for the cancelled OPVs, which was £133 million ($1.3b).
But long before a settlement was agreed to with BAE, the country's governments—the former PNM (People's National Movement) administration, which placed the original order, and the present PP coalition—were having problems with the British defence company.
The UK's Ministry of Defence, which had provided technical assistance to the project, was also aware of BAE's failure to meet its contractual obligations.
Both BAE and the T&T Government agreed upon the resolution of the dispute to a non-disclosure clause for arbitration documents. BAE Systems was seeking to recover $611.032 million from the State as it had taken a 100 million pound sterling charge on its books and, in turn, T&T had issued a counter-claim of $1,654 million for the boats, which were valued at £155 million ($1.55b).
There was no arbitration judgment as both parties settled the matter shortly after the hearings concluded. What exists are witness statements and documents filed in support of each party's claim.
In copies of documents obtained by the Sunday Express, which formed part of the arbitration hearings between the parties in London from May 8-18, it outlines deadlines which BAE failed to meet with the OPVs, the lack of information and transparency provided to T&T as a customer, as well as ways in which BAE sought to compensate this country for their inability to keep to the terms of the contract signed in April 2007.
Details were contained in the witness statement of Commodore Garnet Best (Retired T&T Coast Guard), who was the director of Defence Transformation and Integration Secretariat (DEFTIS), which was a unit in the Ministry of National Security, and Captain Mark Williams, who managed the OPV project for T&T in the United Kingdom.
Best, who was instrumental in the conceptualisation of the OPV project, noted when RFPs (request for proposals) were first issued by the PNM government, it was very specific in what it wanted: "We wanted an armament capable of firing both 'aim to miss' and 'aim to hit' rounds, for which purpose accuracy was important."
Mere months after the execution of the contract, BAE informed the Joint Programme Board meeting (which handled the OPV matter) of a delay in delivery of two interim vessels.
Since 2008, the PNM government was aware of the late delivery of the interim vessels, as well as the push back of delivery of the OPVs.
"I recall also that in its report on June 17, 2008, the MOD (British Ministry of Defence) was critical of BAES and its lack of openness and transparency, and its failure to share information and details of its build programme, which was inconsistent with the principles of the partnership agreement that I had signed in October 2007. The MOD also noted there were discrepancies in what BAES was stating to be the cause of the delay and also what it was reporting as to the precise extent of the delay," stated Best.
The former CG commander said it was the MOD which advised T&T to "reiterate the importance of the contractual delivery dates" for OPV 1, in time for the Commonwealth Heads of Government Meeting (CHOGM) in Port of Spain in November 2009, "which was to be attended by Her Majesty the Queen and for which meetings we had planned to use OPV 1 for security purposes as BAES was aware".
However, BAE failed to meet their own deadline targets in 2009 for delivery of OPV 1 and OPV 2.
Best said on 16 May, 2009, the Trinidad and Tobago government issued a notice of default in respect of BAE's failure to deliver OPV 1 by the contractual delivery date. However, a month after, BAE insisted it could meet the OPV schedule as previously forecast—OPV 1 on February 24, 2010, OPV 2 on May 15, 2010 and OPV 3 on November 15, 2010.
"During the course of late 2009 and 2010, in consequence of these delays and BAE's consequent default under the contract, giving rise to a right to terminate the contract with the government, BAE proposed re-setting the delivery dates for the three OPVs, in return for providing the Government with a package of compensation," he said.
However, that draft was not signed by the old administration or the new People's Partnership Government.
But the company then experienced another problem with the combat systems.
A major cause of concern was that the guns were not done to specifications and whether they could be effective—it could not successfully hit a moving target unless done manually, which would not be practical on the high seas, and could only fire within a 4 km and not a 6 km radius, which was specified in the contract.
"We considered it vital that OPV 1 be demonstrated to be fully compliant with the build specification before the Government accepted the vessel, all the more so because it was first of class. BAE's reluctance to provide further trials and tests to satisfy its customer was difficult to understand," said Best.
"BAES was asking us to accept the vessel without having demonstrated any effective capability of the main armament in the mode in which it was primarily intended to be operated. We had no data on the performance of the armament and no visibility on how it would perform after the problems had been resolved.... In an e-mail to me of May 18, 2010, commenting on the letter, Captain Huggins (also of the T&T Coast Guard) observed: "It is clear that this vessel would not be able to defend itself if attacked when up against current technology. I would not like to sound or appear facetious, but in terms of a naval vessel, our attempts of an upgrade has more or less resulted in a downgrade...we are back to using mechanical sights."
Following this, a report was done by the UK's Ministry of Defence on June 18, which observed that T&T OPV 1 had been offered up for acceptance "with a degraded combat system and a number of relatively minor outstanding issues/defects throughout the ship".
In its assessment report, the MOD surmised: "In an ideal world, the vessel should be presented for acceptance, fully completed and without any defects. However, in our experience, that is never achieved, and hence there is always a judgment to be made about whether the ship is in sufficiently complete state to 'accept' and take forward."
The MOD had urged T&T to consider accepting the degraded boat with a hope of rectification (possibly one year).
For his part, Best agreed with the MOD to accept the OPVs subject to the contractual commitments being put in place pre-acceptance.
"A large amount of time and money had been invested in the project, not to mention manpower (including a large number of staff and crew) over an extended period of time," he observed.
Best wasn't the only one who shared this view.
On August 14, 2010, former minister of National Security John Sandy had provided a note to Cabinet in which, having reviewed the regional maritime security requirements, had recommended that government accept the OPVs on the basis of an acceptance agreement put in place that included a rectification plan to correct all outstanding faults, compensation for the diminished capability of the combat system and a re-negotiated compensation package for delayed delivery.
That was disclosed in the witness statement of Attorney General Anand Ramlogan. In his witness statement to the arbitration, Ramlogan said it was a collective Cabinet decision to terminate the contract on September 16, 2010.
"One of the factors that weighed in keeping the OPV contract going was the vast amount of time, sunk cost and opportunity cost, in terms of man time, that we had invested over a very substantial period of time, and the fact that we needed to upgrade our maritime capability. However, in the end, we decided to cancel for the reason stated in our letter the following day: namely, the very substantial delay in BAES in delivering the OPVs which did not inspire any confidence as to the future. Added to this history of delay was the future ongoing delays in delivering the OPVs, the continuing uncertainty over future timescales for rectification, the uncertain prognosis upon rectification and the risks that Government would be taking in accepting the OPVs in these circumstances," stated Ramlogan.
—To be continued in tomorrow's Express
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BAE offered $910m
By Asha Javeed asha.javeed@trinidadexpress.com
Story Created: Nov 17, 2012 at 10:51 PM ECT
(
Story Updated: Nov 17, 2012 at 11:33 PM ECT )
When UK firm British Aerospace Engineering (BAE) Systems agreed to settle its dispute with Trinidad and Tobago over an arbitration which they initiated over this Government's decision to cancel an order for three offshore patrol vessels (OPVs), BAE was only prepared to offer £91 million (TT$910 million).
Furthermore, BAE had demanded a confidentiality clause in their settlement.
The firm's decision to settle followed an aribitration hearing in May over a span of two weeks. However, that sum wouldn't have been enough to cover the £98.764 million debt which the T&T Government owed in outstanding loans from the cancelled project.
The details were disclosed in a five-page note to Cabinet, dated October 24, 2012, with the code AG (12)154 and titled: "Execution of Deed of Settlement between the Minister of Finance on behalf of the Republic of Trinidad and Tobago and BAE Systems Surface Ships International and BAE Systems Plc (BAE Systems)", which was obtained by the Sunday Express.
Attorney General Anand Ramlogan "was able to negotiate an uplift of approximately £40.0 million from the initial offer of settlement from BAE to £131.0 million".
"Cabinet is advised that the Attorney General was of the view that the proposed settlement would be beneficial to Government and instructed Charles Russell (a British law firm) to negotiate a Settlement Agreement with BAE to give effect to the agreement between the parties," the note stated.
In the Deed of Settlement with BAE, the Government "agrees that any public statements may not refer to the terms of this Deed except to the extent of the wording contained in Schedule 3 of that Deed."
Schedule 3 read: "BAE Systems and the Government of the Republic of Trinidad and Tobago have reached a full and final settlement of the dispute between them in relation to the contract for the supply of three Offshore Patrol Vessels in the sum of £131 million. BAE Systems and the Government are pleased that the dispute has been settled amicably."
The note advised that: "Cabinet is asked to note therefore that extreme caution must be exercised by all members of Government before making any reference whatsoever to this matter, and only if such reference is required, since any failure by Government to observe the terms and conditions of the Deed will jeopardise the settlement between Government and BAE."
In the note which Ramlogan's Ministry prepared to Cabinet, it disclosed that T&T could benefit from the acceptance of BAE's £131.0 million.
"Cabinet is advised that the Ministry of Finance and the Economy has given due consideration to the treatment of the proceeds of £32.236 million in the fiscal accounts and in accordance with international best practice, the proceeds from the settlement could be classified as the sale of assets and to that end, the proceeds from BAE should be revenue enhancing and could be utilised either to reduce the fiscal deficit or to increase public expenditure," it said.
"Cabinet is advised that the methodology for treating with the proceeds of the settlement: repayment of debt and enhancement of public revenue would result in a reduction in the debt stock of £98.764 million or 0.6 per cent of Gross Domestic Product (GDP) with an associated savings on principal repayments and interest costs which latter amount to approximately £5.417 million. In that connection, the Minister of Finance and the Economy has taken steps to cancel the performance bond under the contract and to provide formal notifications to the bank of the settlement agreement," it also said.
The note had advised Cabinet on why it should agree to BAE's settlement.
The reasons put forward were:
1. The benefits to the people of Trinidad and Tobago arising out of the settlement of the matter in the amount of £131.0 million since the early repayment of the loan would result in the remittance of a surplus of £32.2 million to the Government which would utilise the proceeds for revenue-enhancing purposes and as such the amount would be available for more pressing projects;
2. The repayment of the loans would result in a total interest savings of approximately £5.417 million which would therefore be available for more important purposes;
3. The operational costs for the three OPVs would have amounted to approximately $32.0 million per annum;
4. There is a tangible diplomatic value in the amicable resolution of a dispute (on favorable terms to Government) between the Government and a UK Contractor, in circumstances in which the UK Government had taken a specific role as advisor to Government;
5. The Permanent Secretary, Ministry of Finance and the Economy has taken steps to request a refund of £2.1 million from the UK Ministry of Defence to Government in respect of excess monies paid by the Government pursuant to the Government Contract between the Government of the United Kingdom and Government.
"This excess arose because as at the date of termination of the OPV Contract, the monies paid by Government to the UK Ministry of Defence exceeded the value of the work done and the services provided by the UK Ministry of Defence under the Government Contract," the note stated.
6. The immediate settlement of the matter would be a further saving of any further costs for legal services and attendance of witnesses in the United Kingdom which would have to be incurred in relation to the further hearings on quantum which will take place if the matter is allowed to proceed.
7. Attorneys-at-Law for Government had advised that notwithstanding the technical strength of Government's claim against BAEs, even if Government were to succeed on liability, there was a good chance that due to evidentiary problems and poor record-keeping from the start of this Project, Government might not have been able to prove its entire counterclaim for all expenses incurred in the Project.
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^^^ None of this really means anything, given the source:
Details were contained in the witness statement of Commodore Garnet Best (Retired T&T Coast Guard), who was the director of Defence Transformation and Integration Secretariat (DEFTIS), which was a unit in the Ministry of National Security, and Captain Mark Williams, who managed the OPV project for T&T in the United Kingdom.
All this does is outline the Government's complaint... doesn't state with any objectivity what did, or did not happen in negotiations.
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I dunno if it was in the online version of the express but in the print version...in the article "BAE vs T&T Govt" there was a small box with the following words
Ramlogan Responds:
Contacted by the Sunday Express yesterday on issues arising out of the arbitration documents, Attorney General Anand Ramlogan said that he was concerned about the disclosure of the documents. "I am extremely concerned about the disclosure of sensitive and confidential information. The settlement agreement contains a non-disclosure clause which is binding upon both parties, and any comment on issues subjec of the arbitration may violate same. I wish to urge the media to refrain from disclosing such sensitive information as this was an international arbitration, and the terms of the settlement agreement ought to be respected."
When the Sunday Express asked him why he agreed to a non-disclosure clause in the first place since he had used public funds to fight an arbitration, Ramglogan responded: "Such a clause is not unusual for settlement agreement, but the facts of this matter have been in the public domain for some time. I delivered a full statement in Parliament on the details and circumstances but going into evidence is another matter."
Seems like the terms of this settlement need to be highy secret.
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This is such bullshit... how you going to agree to a non-disclosure clause as a government, where public money jumping up? I want to see whether the legal community will chime in on this one.
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They are a terrible government but fair is fair.If what Anand say is true then this has to be seen as a positive for us. The fact that we didn't have to pay BAE still amazes me and the fact that they will pay us something back is absolutely shocking. We should never have cancelled the OPVs in the first place but they did well to dodge the bullet financially.
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They are a terrible government but fair is fair.If what Anand say is true then this has to be seen as a positive for us. The fact that we didn't have to pay BAE still amazes me and the fact that they will pay us something back is absolutely shocking. We should never have cancelled the OPVs in the first place but they did well to dodge the bullet financially.
+1
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(http://fbcdn-sphotos-a-a.akamaihd.net/hphotos-ak-ash4/374421_303682399735828_1398120098_n.jpg)
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Lols
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http://www.trinidadexpress.com/news/Billion_lost__billion_gained-179890051.html
Yesterday, the Sunday Express examined the relationship between the Trinidad and Tobago Government and the United Kingdom firm British Aerospace Engineering (BAE) Systems over a contract for and subsequent cancellation of three offshore patrol vessels (OPVs). It was knitted together from the witness statements and documents submitted to the International Court of Arbitration during the period May 8-18, 2012 for which a non-disclosure clause was agreed.
The story revealed that the PNM administration, who had initiated the programme, had been concerned about BAE's inability to meet deadlines, their lack of transparency and their failure to meet contractual obligations. The People's Partnership Government served notice to BAE on September 16, 2010 and the contract was officially cancelled on October 20, 2010.
A billion dollars lost for a seemingly billion-dollar gain.
That's how the arithmetic for the cancellation of the offshore patrol vessels (OPV) project works out.
The Government of Trinidad and Tobago (under the former administration) had taken a $2.192 billion loan from BNP Paribas and Lloyds for the financing of three Offshore Patrol Vessels (OPVs) in 2007.
The total sum of the OPV boats was £155 million.
Following the cancellation of the contract, Attorney General Anand Ramlogan had negotiated an out-of-court settlement of $1.382 billion with BAE. According to figures provided by Ramlogan in Parliament last Friday, the Government's balance on the loan was $1.041 billion.
Once the settlement is applied to the loan, the surplus is $341 million said Ramlogan. That sum, he had said, can be used at Finance Minister Larry Howai's discretion.
At a press conference at his Cabildo Chambers office last Wednesday, Ramlogan had said it was difficult to estimate the amount of money T&T had lost on the OPV project.
But a calculation by the Express of loan ($2.192) minus settlement ($1.382) points to about $800 million.
An official close to the project under the PNM government, who spoke on condition of anonymity, observed that that cost is exclusive of the cost borne by the State for the infrastructure work undertaken by the Coast Guard to accommodate the 90 metre boats at Staubles Bay, Chaguaramas.
Ramlogan had also revealed in Parliament that "other costs associated with the implementation of the OPV project, which include for infrastructural and logistical support, which were paid by the Government Treasury" amount to approximately $164 million dollars.
The $800 million already spent on the OPV project added to infrastructure costs of $164 million amounts to $964 million.
When the legal fees of the AG's team, which he estimates to be under £2 million that'll take the total loss of the OPV project to over one billion dollars.
The official pointed out that T&T had lost money and still did not have boats to secure its borders. The official noted that Government now had to purchase new boats and questioned how it will finance this project which could amount to over a billion dollars as no worthy patrol boat could be had for under $400 million.
The Government had taken a collective Cabinet decision to terminate the contract on September 16, 2010. Following this BAE had initiated arbitration hearings in London seeking over $611.032 million and managed to sell the three OPVs— which were named Port-of-Spain, Scarborough and San Fernando- to the Brazilian Navy for £133 million.
There's been the argument that the $1.382 billion settlement was simply a refund equivalent to the £133 million sale by BAE to Brazil. And far from earning money from this arbitration, this country had actually lost- not in settlement but in dollars spent.
The People's Partnership decision to cancel the £155 million contract with BAE came despite recommendations that the Government accept the OPVs from BAE.
Those recommendations came from the UK's Ministry of Defence (MOD), Commodore Garnet Best, Captain Mark Williams and former minister of national security John Sandy. Their recommendations were based on the amount of money already spent on the project which had spanned three years and had no tangible result save for the infrastructure work completed to accommodate the vessels and the training of 120 staff for the project.
In his witness statement, Williams said the MOD's had recommended that was "to keep the moving" forward subject to clear agreements and commitments on the part of BAE
"With respect to recommending acceptance for vessels being built for the Royal Navy, it was usual for the MOD to take decisions that would keep their programme moving forward as their vessels are not normally required to enter service until a considerable time after the vessel has been completed. This, however, was not the case with respect to the OPVs, which is why the MOD's recommendation was caveated with the question of whether of not the vessel had sufficient interim operational capability with the degraded weapon system and whether training of crew could take place on board concurrently with any agreed rectification plan," he said in his witness statement.
As a project leader, Williams said he was concerned about the impact in the morale of staff and crew.
"However, wearing my senior naval officer's hat I was extremely concerned that we were being asked to consider accepting a vessel the defensive capabilities of which fell far short of what had been expected and was contractually required. The OPV was £50 million pound asset as a result itself a target. The degraded Combat System did not enable it to adequately defend itself," said Williams.
Despite his recommendations Williams had remained concerned about accepting the vessel given that rectification by BAE was estimated at 12 months and that the Government of T&T would not receive a vessel for which they had contracted or would meet the requirements needed to secure this country's maritime boundary sufficiently.
"Given the outstanding defects and the uncertain path and time scale to resolution, the OPV was being offered with a degraded Combat System. The MOD noted: Based on demonstrations, the weapon can still be used to fire munitions out to a range of 6km by manually inputting the 'target range' from information extracted form the Scanter radar. However, with the added time delays associated with inputting the range data and without the benefits of the predictor, it is questionable how operationally effective the weapon will be against realistic targets." In other words, it in present condition the 30 mm gun could not effectively engage moving targets and the 6km capability was a maximum range not maximum effective range," he stated.
Following the notice of cancellation in September, he observed that BAE had sought to speed up the delivery before the October 20 deadline. However, by October 16, BAE had not followed the correct protocol in accordance with the contract.
In explaining his decision to terminate the contract, Ramlogan had argued in his witness statement that "BAE was asking us to forego our existing contractual rights in favour of whatever we might be able to negotiate with BAE'S post acceptance and once the OPVs were in service in the waters of Trinidad and Tobago."
In Parliament, Ramlogan said the Government had saved a $32 million dollar recurrent expenditure for maintenance of the boats as well as a $24 million recurrent expenditure for the crew.
To be continued in tomorrow's Express
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.Kamla 'proud' of Anand
By Anna Ramdass
By anna.ramdass@trinidadexpress.com
Story Created: Nov 18, 2012 at 10:50 PM ECT
Story Updated: Nov 19, 2012 at 7:18 AM ECT
Prime Minister Kamla Persad-Bissessar yesterday expressed pride in Attorney General Anand Ramlogan for his role in the success of the settlement of the of the Offshore Patrol Vessel (OPV) arbitration process with shipbuilder British Aerospace Engineering (BAE) which resulted in the payment of $1.382 billion to the State.
"I am proud and satisfied that this matter has been amicably resolved and wish to pay tribute to the Attorney General, Anand Ramlogan, for his dedication and commitment to this matter."
The Prime Minister joined in the chorus of praises for Ramlogan as on Saturday National Security Minister Jack Warner also issued a release stating that Ramlogan's success in the settlement was a form of vindication as many have called for his (Ramlogan's) removal.
Yesterday, the Prime Minister not only sent the message that her confidence in Ramlogan remained strong but also said that the OPV settlement was one where the nation can "feel duly proud".
"Today, I feel vindicated by the decision I took, as we have been able to repel a $700 million claim against our country and emerge victorious with a settlement of $1.4 billion," said Persad-Bissessar.
She said that while many appear to be "shell shocked" by the positive result— her Government was not.
"There is no 'secret deal', or hidden, undisclosed, future cost or supplemental agreement; the $1.4 billion represents full and final settlement without the government having to pay any money to BAE," she added.
The Prime Minister said that the settlement will allow the Government to repay the OPV loan and also provide a surplus $340 million which can be utilised for the benefit and upliftment of our people.
"This isn't a political victory; it is an undeniably positive result for every citizen," said Persad-Bissessar as she expressed thanks to members of the Defence Force and her Cabinet
http://www.trinidadexpress.com/news/___Kamla__proud__of_Anand-179890041.html
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Opposition MP Colm Imbert says T&T lost $700 million by cancelling the $1.3 billion contract for the delivery of three offshore patrol vessels (OPVs) from BAE Systems. Imbert spoke at a news conference at the Office of the Leader of the Opposition, Charles Street, Port-of-Spain yesterday.
He is also insisting that since there was simply a negotiated settlement between the two parties, neither side won or lost. “The parties left the arbitration process and came to an agreement behind closed doors,” Imbert said. “There is simply no finding of any arbitrator that T&T was right or wrong or that BAE was right or wrong. There was no decision of the arbitration tribunal; there was no finding of fact; there was no finding of liability.”
He said the non-recoverable costs for the OPV contract amounted to $365 million:
• Training—$60 million
• Maintenance—$60 million
• UK Govt support—$36 million
• Consultant/legal fees—$21 million
• Currency exchange and export credit premium—$59 million
• Upgrade of infrastructure at Staubles Bay—$112 million
• Arms, accommodation, travel, subsistence costs etc—$17 million
Imbert said the total expenditure on the cancelled OPV contract to date was at least $2.05 billion. He said the amount to be recovered from BAE was TT$1.35 billion. Imbert also had in his possession a Cabinet note dated August 6, 2010 which showed then national security minister John Sandy recommending that the PP Government accept the first OPV. The T&T Guardian understands that the note was not approved by the Cabinet.
Opposition Leader Dr Keith Rowley also spoke at the news conference. Rowley said the people of T&T should be very wary of moves by the Government to have Colombia supply long-range vessels to fight crime, as Colombia was not the solution to the problem but the source.
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I disagree with Rowley's reasoning for opposing the Colombia deal.
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Our billion-dollar OPV hole
By Clarence Rambharat
Story Created: Nov 19, 2012 at 9:58 PM ECT
Story Updated: Nov 20, 2012 at 8:49 AM ECT
http://www.trinidadexpress.com/commentaries/Our_billion-dollar_OPV_hole-180067361.html
There is little reason for celebration if the country did nothing wrong on the Offshore Patrol Vessel (OPV) deal but suffers a billion-dollar loss. It is why the country is divided on the settlement, and it will not end here. This will be a headline act leading to the Tobago House of Assembly (THA) election and, after that, fundamental questions will remain unanswered.
Three questions arise. First, exactly how much did the country lose on this OPV project? Second, going back to the original issue, what is the plan for dealing with the maritime risks, and what new spending is required? And third, was corruption an issue in this OPV procurement, and how quickly will the Government implement the lessons learnt from this aborted purchase?
At the heart of the country's dilemma is the usual absence of details and the People's Partnership Government's credibility challenge. Those politically opposed to the Partnership will obviously see no merit in this settlement, but this Government never helps its own cause. If this climb halfway up a $2.5 billion hole is good news, it demonstrates how bad things have been for the Government.
On that first question of the amount lost, get this fact out of the way. This settlement is not a windfall of any kind for the country. The work of those who identified the contractual failures of BAE Systems (BAE) since 2009, and the Cabinet which terminated the deal in late 2010, was about loss reduction. The country's outlay on the vessels, training, infrastructure, legal expenses, financing and other costs related to this procurement must run close to TT$2.5 billion. If TT$1.32 billion is recovered from BAE, then we are still in a TT$1 billion hole. A billion-dollar loss is no cause for celebration.
In the aborted contract, the country is the big loser. While BAE's annual reports consistently recognise the risks of doing business with governments, the company's big deals with sovereigns sustain its global business model. The local deal was very small in the context of BAE's annual earnings, though it required specific disclosures in the financials when it fell apart. It is therefore unlikely that BAE sustained a loss on the aborted deal, but if it did, it was small.
More important for BAE, even though the company had breached its contractual commitments to this country, the settlement provided it with a decent exit and left us with its losses. From a financial perspective, BAE had already sold the vessels to Brazil, landed orders from Brazil for additional vessels, and achieved its objective of doing more business in the lucrative Latin American market.
Further, this TT$1.32 billion payment to the country does not come out of BAE's pockets. In the company's 2010 and 2011 financials, BAE held 125 million pounds sterling as deferred income on behalf of this country, the company's recognition that it had not yet earned this income. The settlement is a refund of money which was this country's anyway, and leaves us in search of OPVs with TT$1 billion less.
That brings us to the national security issues which remain unanswered. It is not clear whether the Cabinet terminated the OPV contract solely on account of BAE's contractual failures, or on account of the fact that the OPVs did not fit into a crime-fighting strategy of the Government, and BAE's breaches created an exit opportunity for the country. We cannot answer those questions because there is still no coherent plan to fight crime; no details of the "Maritime Wall" the Government proposes and its justification; no expected cost and no timeframe for delivery.
We do know that the Government is considering Colombian vessels. The OPVs will likely come out of the Colombian government-run COTECMAR, which builds the vessels using a design developed by the German shipbuilder Fassmer, not BAE. When the Colombians took delivery in 2010 of the first OPV from that facility, the vessel had taken 18 months to build. This is a smaller OPV compared to BAE's and unlike BAE's it does not have the armament facilities. It means that at best, even though it may do so at a cheaper cost than BAE, new Colombian-built OPVs may not be deliverable until 2015.
This brings us to the next question. In an industry rife with allegations and admissions of corruption involving suppliers, government officials and intermediaries, the Government has not said whether corruption was an issue in the original deal. BAE has recently settled corruption allegations, including US$479 million in fines in the US. Next month, the BAE lobbyist who figured in the US issues, goes on trial in Austria on charges of involvement in corrupt arms deals. It will focus attention on the global trade in legal and illegal arms and the corruption of government procurement, especially in these deals with billion dollar spending.
And speaking of big spends, the final question relates to the lessons the Government has learnt in handling billion-dollar public sector procurement projects. The OPV deal is at times similar to the Point Fortin Highway project, with a lack of information, transparency, and citizen engagement. But the highway project exceeds the value of six OPV settlements. What lessons from the loss-cutting OPV settlement will the Government implement to avoid a repeat, starting with the Point Fortin Highway project? When the Government talks about the poor accounting issues with the OPV project, what exactly happened and who is being held responsible? More importantly, what in the highway project and Government procurement generally will be changed on account of whatever discovery the AG and his legal team made, leading them to believe that some parts of the country's counterclaim against BAE had to be abandoned?
The country is already divided on this OPV settlement, and losing a lot of money is really no cause for celebration when we did no wrong.
• Clarence Rambharat is a lawyer and a university lecturer
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This is a smaller OPV compared to BAE's and unlike BAE's it does not have the armament facilities. It means that at best, even though it may do so at a cheaper cost than BAE, new Colombian-built OPVs may not be deliverable until 2015.
Isn't this similar to the reason for cancelling the BAE deal in the first place.
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This is a smaller OPV compared to BAE's and unlike BAE's it does not have the armament facilities. It means that at best, even though it may do so at a cheaper cost than BAE, new Colombian-built OPVs may not be deliverable until 2015.
Isn't this similar to the reason for cancelling the BAE deal in the first place.
you are missing the point sir,, they go cancel the colombian deal...go to arbitration and declare that we make MORE money in the settlement
T&T go come very wealthy by hustlin all dem dotish multinational companies....we rrrrrrrrrrrrrrreeeeeiiiiiiiiiiiiiiiiiiiicchhh
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This is a smaller OPV compared to BAE's and unlike BAE's it does not have the armament facilities. It means that at best, even though it may do so at a cheaper cost than BAE, new Colombian-built OPVs may not be deliverable until 2015.
Isn't this similar to the reason for cancelling the BAE deal in the first place.
I guess the rationale is.....yuh not going to have the right gun anyhow..might as well pay less for it.
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This is a smaller OPV compared to BAE's and unlike BAE's it does not have the armament facilities. It means that at best, even though it may do so at a cheaper cost than BAE, new Colombian-built OPVs may not be deliverable until 2015.
Isn't this similar to the reason for cancelling the BAE deal in the first place.
I guess the rationale is.....yuh not going to have the right gun anyhow..might as well pay less for it.
Is either you need the guns or you don't .
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The drug subs is the real problem. Anything entering our waters easy.
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Did the Brazilians bought the 3 OPVs with the "defects". Did they pay less because of the "defects"?
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Is either you need the guns or you don't .
Yuh clearly don't need guns on the water when all Trinidad problems is on land.