Monday 26 October, 2020

Government extends Cabo Star lease for 2 more years at reduced rate

Government said the Cabo Star cargo vessel will be leased for an additional two years at a reduced rate.

Minister of Works and Transport Rohan Sinanan said the lease has been secured at a reduced rate of US$16,000 per day instead of the initial rate of US$21,000 per day.

‘At this point Cabinet has accepted the recommendations from NIDCO to renew the Cabo Star’s [lease] at a rate of US$16,000 per day for the next two years.’

Sinanan said after the lease of the Cabo Star in 2017, NIDCO issued invitations to tender and in May 2020 got 15 responses.

He said four were shortlisted and an award letter was issued to Stena RoRo. However the company responded to NIDCO that they could not hold the price which was tendered to them.

‘Unfortunately NIDCO considered that to be a breach and immediately engaged the second, third and fourth option. Unfortunately the next three providers did not want to consider a reduction in their price and NIDCO went to Bridgemans…and they had a reduction in their price. So this morning Cabinet accepted the recommendation from NIDCO to renew the contract for the Cabo Star for a further two years at a reduced rate of US$16,000 per day.’

Sinanan said the contract was renegotiated to this reduced rate. He added that the MV Kerry, which was preferred at the time, had a daily rate of US$23,000.

Sinanan added that both the Buccoo Reef and APT James, two passenger vessels which are being built in Australia to service the seabridge, are being completed within budget.

‘We have the advantage of two new passenger vessels with cargo facilities. That will allow us to take products to Tobago that we will want to get there as a faster rate. So you have the options of the two new passenger vessels taking cargo, and the Cabo Star which can take cargo such as building materials.'

Sinanan said they received complaints about the duration of the Cabo Star’s journey as well as the space for passengers, which he said is also being addressed.

He said government is still looking at options to find someone to build a cargo vessel for the seabridge in future.

'Cabinet approved for NIDCO to go out, and just like we did with the passenger vessels, for the building of a cargo vessel.'

‘That Cabinet note still has life in it and NIDCO will continue to pursue the options of a custom-built vessel for [Trinidad and Tobago]. Just like we built these passenger vessels it will take some time, which is why we decided to renew the lease with the option to renew for further one year. NIDCO will continue to explore the possibilities of a custom-made cargo vessel.’

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