Public Services Minister Marvin Gonzales said his department was carrying out a feasibility study to determine whether the controversial and now abandoned Beetham Wastewater Reuse Plant (BWRP) could be made operational.
In February, the National Gas Company (NGC) transferred the assets of BWRP to the Water and Sewerage Authority (WASA).
But Gonzales says the utility still needs to decide if it’s possible to complete.
‘The reuse of the millions of liters of water from the Beetham sewage plant is being reviewed by the department and WASA to determine its financial feasibility,’ Gonzales told the Sunday Express yesterday.
“I want to be able to have a full review between WASA and NGC completed in two to three months. Once I am satisfied with the review, I will determine the next step. I don’t believe we can continue to have 13 million imperial gallons (MIG) of highly treated wastewater from this plant discharged into the ocean when this can be easily used for industrial purposes and so many other uses,” Gonzales explained.
He explained that the Beetham sewage treatment plant was built and commissioned in 2002 by the then Manning administration.
However, it discharges 13-14 MIG of treated water per day into the ocean.
The Beetham Wastewater Reuse Plant, designed by the People’s Partnership administration, was a plan to reuse waste water for industrial purposes.
NGC, which was the client, terminated the contract with Super Industrial Services for the BWRP project on November 20, 2015, and in March 2016 it took possession of the BWRP project assets from SIS.
“The project was to capture water (those 13 MIGs) from the plant and run a pipeline to the Point Lisas industrial area. They would build another treatment facility to treat the water and convert it for industrial use so it could be used to support factories,” Gonzales said.
He said the problem with the project “started with the cost and the inflated costs”.
In addition, their business plan provided that when NGC captured the water and treated it, NGC would sell the water to WASA.
“That was the business model they were following. The water that the plant would have captured, piped to Point Lisas, converted for industrial use by NGC – it was an NGC-funded project. WASA was going to buy this water from NGC at a high price, so the project would not have benefited WASA. This would have really hurt WASA’s financial stability further, on top of the pain it was already going through getting out of its desalination contracts.
“In their model, they intended to use the subsidies WASA received from the government to purchase this water from NGC. So cost aside, the business model was a flawed business model that would have put WASA even further out of business,” Gonzales said.
He said the project was shelved when the PNM government returned to power in 2015.
In total, NGC spent more than $1 billion on the project and wrote $943.7 million off its books.
All project assets – pipes, pumps, tools and five million gallon tanks – were transferred to WASA by the NGC.
In a statement to the Sunday Express, the NGC noted that approval had been gained to transfer assets from BWRP to WASA.
“The Chairman of NGC has sent a letter to the CEO of WASA informing him of the transfer of assets to WASA as of November 16, 2020. NGC and WASA staff have completed asset verification at all sites. NGC and WASA have agreed on dates for the transfer of custody of the sites and assets and have completed the physical transfer.
“The handover of the Beetham Estate site, tank farm site, Point Lisas, NGC storage site assets, Point Lisas and Caroni River Bank storage site assets was completed on 13 February 2022.
“Discussions are ongoing between WASA and NGC regarding the transfer of custody of the pipelines along the right-of-way and the pipelines already buried underground. NGC and WASA are in the process of finalizing the asset transfer agreement,” says the communicated.
Gonzales doesn’t want the assets to go to waste.
“What I am doing is reviewing the assets that WASA has received from NGC and appointing a committee made up of both entities to review the plan. Some 13 million gallons of treated water that can be used for industrial purposes and to examine the financial feasibility of continuing the project. We will not be using the UNC business model, but will allow WASA to control the flow of water from the Beetham to the industrial plants, further treat the water, and then sell more water to the estates. By doing so, WASA can improve its financial performance and free the country from its heavy reliance on desalinated water,” said Gonzales.
Last week, the Business Express reported exclusively on the WASA short to medium term strategic action plan, which was approved by the Board of Commissioners in January 2022 and submitted to Cabinet in March 2022 where it was ratified before d be subject to regulated industries. Commission (RIC) for their consideration.
The plan explored WASA’s options to increase water production and reduce the country’s dependence on Desalcott.
To this end, a water audit will be undertaken by WASA
“Most importantly, the water audit would delineate the areas outside the Point Lisas Industrial Estate that receive between 50 and 63% of the water from the Desalcott plant, and provide an assessment of the volumes and additional pressures needed to replace this area. desalinated water. This assessment would be a key part of a broader national plan to reduce the country’s dependence on desalination,” the plan states.
Last year, Gonzales called WASA’s contract “unsustainable.”
Over the past six years, since the cost of completing the plant was not feasible for NGC, the wholly state-owned company sought to find a viable solution by exploring the idea of a public-private partnership. The most feasible configuration was completion based on the project’s original concept, a plant producing reusable water delivered through an onshore pipeline to Point Lisas for industrial use.
The NGC not wanting to spend more money on the factory, going to the market was an option.
On February 19, 2020, NGC won its lawsuit against SIS over an alleged decision to divest its assets pending resolution of arbitration proceedings regarding the controversial plant.
Judge Joan Charles upheld NGC’s challenge to a series of financial instruments executed by SIS, which she said were designed to ensure that NGC would not be able to recover money, if successful in the arbitration procedure.
After his dismissal, NGC initiated legal proceedings against SIS, which are still before the courts.
SIS used to be the go-to contractor for NGC projects.
Its founder, Krishna Lalla, and the chairman of NGC at the time, Roop Chan Chadeesingh, had shared a business relationship. Additionally, NGC Chairman Indar Maharaj was also the Chairman of WASA. The project was originally an initiative of WASA.
On September 2, 2013, NGC had issued Requests for Proposals (RFPs) for Sole Bidders (a prime contractor with sub-contractors) for the Beetham Water Recycling Plant. Fourteen companies had purchased the tender documents from NGC and conducted a site visit on September 27, 2013.
They had five weeks to submit a bid, which would have closed on October 28, 2013. However, due to demand from several companies, the deadline was extended to December 10, 2013. At that time, only two companies had submitted bids for the project, which were evaluated by NGC’s own bidding committee.
WASA already operates the Beetham Wastewater Treatment Plant, which treats water for domestic use.
In February 2012, WASA signed a $246 million loan agreement with the Inter-American Development Bank (IDB) for local wastewater management, which included recycling water for industrial purposes.
At that time, Environment and Water Resources Minister Ganga Singh said reused water from the Beetham sewage treatment plant would be directed to the Point Lisas industrial estate.
In September 2012, Maharaj had told the Express that WASA did not have the money to pursue the project, so it was handed over to NGC.
Asked then why NGC was embarking on this project and not WASA, given the double hat he wears, Maharaj said: “WASA is also involved insofar as WASA will buy water from NGC. WASA does not have the money to invest in the project. All of these people who would get the water are NGC customers, which also secures NGC’s business.