“We’re evaluating the company’s response to our notice of default,” Muna said, adding that he will meet with the governor “to discuss how we shall proceed.”
According to Muna, DCM advised CUC that it will take months to manufacture and deliver the parts they have identified for the engine repair and overhaul.
Muna said DCM is waiting for the parts for six engines, including #7 which needs a new cylinder head and liner, connecting rod arms, assemblies, and journal bearing, injection pump and injector, and several auxiliaries.
CUC-DCM contract states that “the contractor understands and represents that it has readily available, the necessary expertise, training, knowledge, parts, materials and equipment, manpower and capacity.”
DCM cannot meet its own projected date of delivery of parts to fix the engines immediately, Muna said.
“They haven’t ordered the parts yet,” he added. “That’s another issue that needs to be addressed with them.”
But Muna said the parts for engine #7 will arrive on July 15 and Aug. 15, but they are for other contractors and not for DCM.
CUC will still determine whether these parts will complete the overhaul of engine #7.
“It’s apparent that the projected timelines on the contract and the repairs of the rehabilitation of the engines are not going to be met,” Muna said.
Asked if CUC will penalize DCM, Muna said they can’t.
“The only other option for CUC is to consider terminating the contract,” he added.
CUC will consult with its legal counsel and meet with DCM concerning this issue “to ensure that we can transition this as amicably as we can,” Muna said.
DCM was not available for comments as of press time yesterday.
DCM is the major contractor hired by CUC to repair and overhaul seven of the eight engines at Power Plant 1.
The $5.1 million contract between CUC and DCM was signed on Dec. 12, 2007.
