Public procurement notice: Modification Of A Contract/Concession During Its Term
Published: 2022-03-22
Buyer: Essex County Council
Country: UK
Contract type: Services
CPV classification: 09100000 | 09310000 | 31682000 | 42914000 | 45111000

Technical requirements: The Contract was awarded on 31 May 2012 by Essex County Council (the “Authority”) to UBB Waste (Essex) Limited ('UBB'), following the completion of a full tender process.
The contracted works and services were for the design, construction, commissioning, operation, handback and/ or financing of a mechanical biological treatment (MBT) facility at Courtauld Close, off Courtauld Road, Basildon, Essex, SS13 1FL.
The objectives of the procurement included: improving services for the Authority's customers in a way which also represents value for money; reducing the tonnage of Municipal Solid Waste (MSW) going to landfill, particularly Bio Degradable MSW; recycling more; limiting the impact of rising waste disposal costs to the taxpayer; and reducing the Authority environmental impacts.
As described above, the Contract was awarded on 31 May 2012 to UBB Waste (Essex) Limited, following the completion of a full tender process.
The contracted works and services were for the design, construction, commissioning, handback and operation of a mechanical biological treatment (MBT) facility in the Tovi Eco-Park (Basildon, Essex). Following the initial construction of the facility, the contract provided for a commissioning period followed by Acceptance Tests to confirm that the facility could meet the performance requirements in the contract. If not ultimately passed by an Acceptance Longstop Date of 12 January 2017, the Authority was entitled to terminate the Contract.
The facility did not pass the Acceptance Test by the Acceptance Longstop Date, which resulted in the Authority commencing litigation against the contractor. The Authority has given notice that it is proposing to take a decision to enter into an Amendment and Settlement Agreement to settle that litigation and to amend the handback requirements of the contract on the basis that the site will be cleared and returned to ECC in a
condition that will allow for its future redevelopment. It is expected that the modified contract will have a term expiring in 2040.
- Surrender the Environmental Permit which relates to the operation of the MBT facility and is held by Urbaser Environmental Limited.
- Remove certain hazardous substances from the site and hand back the site in accordance with the conditions in the Amendment and Settlement Agreement, to the satisfaction of an independent environmental consultant.
- Design and build a new surface water management system for the site. This includes re-grading part of the site and installing new surface water retention structures.
- Arrange for the de-energisation of the UKPN electrical sub-station and install a new power supply to the site to serve the surface water management system.
- Procure that its ultimate parent companies indemnifies the Authority (until the expiry of a period of three years following handback) against any failure by the contractor to perform its obligations as set out above and further detailed in the Amendment and Settlement Agreement.
The current modifications have arisen in connection with the proposed settlement of the litigation and the subsequent proposed amendment of the handback requirements of the Contract. The services / works which form part of the agreement with the contractor (which include the demolition services / works) are estimated to be in the region of c. 1% of the original value of the Contract (which was c. £800m).
Nature and extent of the modifications (with indication of possible earlier changes to the contract):
These works are essential to ensure the site is properly cleared and decontaminated as needed and returned in a state that allows its future redevelopment. UBB has the full set of technical information and prior experience to carry out the works/services. As the requisite Environmental Permit is held by one of its affiliates, UBB is essential to surrender the Environmental Permit. There are also significant economic reasons preventing a change of contractor. These arrangements are in the context of a planned settlement of litigation and the objective is to avoid the contractor passing back to ECC the costs of restoring the site. UBB is in a position to procure the provision of a comprehensive package of warranties and indemnities for the work undertaken. As regards the avoidance of inconvenience or duplication of costs, UBB is already present on site with certain machinery and equipment. Its pre-existent knowledge and experience means that significant duplication of costs is avoided.


Winner: UBB Waste (Essex)