V.I. Water and Power Authority board members moved Thursday on a contract extension with Hovensa but revealed that the refinery wants to get out of the delivery business, leaving WAPA to find a way to transport its oil.
The transportation issue won’t take effect until next year, but WAPA is trying to be proactive by dealing with the issue now. Board members said Hovensa has a barge that can only be in use for one more year and when that time is up, the refinery has no plans on either getting another boat or repairing it, leaving WAPA with the responsibility of bringing the oil over itself.
"There’s a few things that have changed in the last few years," WAPA Executive Director Hugo Hodge Jr. said to the board as he explained how contract negotiations with Hovensa went.
Hodge explained that Hovensa is unsure “whether they want to own the barge, whether they want another company to take care of the business, and the liability associated with barging,” among other isues.
Hodge added that’s why, in the last three revisions of the contract, it appeared the price of delivery was increasing.
It was also said that Hovensa has barging companies that it subcontracts with, so WAPA would be looking into the possibility of contracting out for two boats, one for No. 2 and one for their No. 6 oil. In the meantime, the board authorized Hodge to finalize a one-year extension with the refinery, beginning July 1, 2011 to June 30, 2012, for the supply and delivery of its oil.
The board also approved a contract with General Electric for up to $1.5 million in repairs to Unit No. 15. The contract is for $1.2 million, but the project depends on the fixing of a router, which officials said could affect the final cost. If the part goes off island, completion time would take 15 weeks, but if it does not, it will take seven, they added.
The plan is for Unit No. 18 to be back up by mid-April, and once that’s up and running, Unit No. 15 will go down for repairs in mid-May. Representatives from GE will be in the territory the second week of May.
Unit 15’s last inspection was 2006, and board members said it’s overdue for a checkup.
Board members also:
-authorized Hodge to obtain property insurance coverage for the authority for a year, from March 31, 2011 to March 31, 2012, from Wortham Insurance & Risk Management at a premium of $2.1 million, and to obtain a bank loan for the same amount at the best financial terms;
-approved a $35,772.09 change order for the first phase of the Christiansted cable installation project and 30-day extension for Fortress Electric to complete the project, which involves relocating certain overhead feeders;
-authorized a $31,326 change order for Bryan’s Electric Contracting Corp for relocating the secondary underground conductors for the Long Bay Road project;
-approved a six-month rental lease for a unit at Sugar Beach Condominiums for business purposes at a monthly rate of $2,400 for one year; and
-approved a change order extending the completion date by eight days for the first phase of WAPA’s pressure management project, which will now be March 23, 2011.
Board members in attendance at Thursday’s meeting were Alicia Barnes, Wayne Biggs, Donald Francois, Noel Loftus and Juanita Young.
