Progress Report SHIFT Project

Sanitation and Hygiene Initiative for Towns (SHIFT) Project

PROGRESS REPORT n°2

As at 31st December 2017

Credit Facility Agreement No : CLK 1013 01K

Financing Agreement No : CLK 1013 02L

European Union

Project Management Unit

Sanitation and Hygiene Initiative for Towns (SHIFT) Project
National Water Supply and Drainage Board
No. 38, Charles Place
Rawathawatha
Moratuwa.

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Progress Report SHIFT Project

CONTENTS

Summary and context of the Project

Consultancy Contracts
1. Management Support Consultancy (MSC)

2. Design and Construction Supervision Consultancy (DSC)

3. Policy and Institutional Enhancement Consultancy (PIEC)

4. Sewerage Management Skills Development Consultancy (SMSDC)

NGO Contract

1. Pro-Poor Fund and NGO

Works Contracts
2. Construction of Collection system with Pump Houses for Negombo Wastewater
Disposal System

3. Design & Construction of Wastewater Treatment Plant (TP) & Main Pump
House (MP), Construction of Sea outfall , Procurement of O&M Equipment for
Treatment Plant & Main Pump house , Construction of O&M facilities in
Negombo Wastewater Disposal System

4. Construction of Sewerage Head Quarters Building

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Progress Report SHIFT Project

SUMMARY AND CONTEXT OF THE PROJECT

1. Introduction

As far as Sri Lankan waste management sector is concerned, only 2.4% of the Sri
Lankan population is connected to a collective wastewater management system and
the majority of the population uses individual sanitation systems. In reality, most of
the existing collective systems are out dated and poorly maintained. This has
decreased their ability to function efficiently. Therefore inefficiently treated wastewater
is discharged into drainage channels with serious consequences for both public health
and the environment.

Considering the prevailing situation in the sector, the ‘Sanitation and Hygiene
Initiatives for Towns’(SHIFT) project has been initiated to estabilished three collective
wastewater management systems for Negombo, Galle-Unawatuna and Kelaniya-
Peliyagoda areas.

The overall objectives of the SHIFT Program are;

(1) Clarify and enhance the sanitation sector framework;

(2) support sustainable access to sanitation services in targeted cities located in

South West Sri Lanka;

(3) Facilitate access to the sanitation services for disadvantaged households;

(4) support the preservation of ecosystems (coastal and marine) and biodiversity.

Due to fundraising constraints, the investments planned under the SHIFT Program
have been divided in several parts, referred hereafter as: SHIFT1, SHIFT2, etc.

The financing for SHIFT1 is already secured. NWSDB will apply for financing for
subsequent phases of the SHIFT Program when the engineering studies for targeted
cities will be available.

The SHIFT1 will include the following investments:

• Studies for Negombo, Galle-Unawatuna and Kelaniya-Peliyagoda ;

• Infrastructures construction and works supervision for Negombo only ;

• Design review for Ratmalana-Moratuwa and Jaela-Ekala (for infrastructures

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Progress Report SHIFT Project

related to the remaining part of the cities not yet equipped).

• Technical Assistance

In parallel to SHIFT1, the NWSDB will implement a specific project to complete the
works achieved in Ratmalana-Moratuwa and Jaela-Ekala. The NWSDB is currently
preparing the studies for the Ratmalana-Moratuwa and Jaela-Ekala Project, including
detail design, environmental and social impact assessment and economic and social
analysis. This project will include the following investments:

• Infrastructure construction for Ratmalana-Moratuwa and Jaela-Ekala;

• Works supervision for Ratmalana-Moratuwa and Jaela-Ekala.

The SHIFT2 should include the following investments:

• Infrastructures construction for Galle-Unawatuna, Kelaniya-Peliyagoda ;

• Works supervision for Galle-Unawatuna, Kelaniya-Peliyagoda.

The SHIFT 1 program will be supported by a Technical Assistance (TA). The TA

will consist of the following three consultancy missions.

(i) The Policy and Institutional Enhancement Consultancy (PIEC)

The objectives of the PIEC are to : (a) provide recommendations to

enhance the policy and institutional framework for the sanitation sector ;
(b) provide recommendations to improve the water and sanitation sector
financial viability, assist NWSDB in accounting analyses as part of the
change to International Financial Regulation system(IFRS), develop a
NWSDB financial model and realize a tariff study for the water and sanitation
sector; (c) design the content and assist in the procurement of the
Sewerage Management Skills Development Consultancy (see next
consultancy mission). The estimated duration of the PIEC is 13 months.

(ii) The Sewerage Management Skills Development Consultancy (SMSDC)

In line with the huge infrastructure investments forecasted in the sewerage

area in the country, NWSDB will have to face two big challenges:

(i) develop the capacities to operate and maintain large-scale wastewater

systems

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Progress Report SHIFT Project

(ii) develop a strategy to recruit and train approximately 400 people for the
Sewerage Department in the next six years.

The SMSDC aims at supporting NWSDB to face those two challenges. It

will comprise a support in HR management, day-to-day on ground training
at management and technical level, and development of sewerage systems.
The estimated duration of the SMSDC is 36 months. As the SMSDC will be
design with the support of the PIEC Consultant, this assignment will begin
few months after the commencement of PIEC.

(iii) The Management Support Consultancy (MSC)

The MSC aims a supporting the Project Management Unit (PMU) in the
implementation of the SHIFT1 and in building capacities in the field of
project management. The MSC will be in place during the duration of the
SHIFT 1 (60 months). It will comprise a residential technical assistance
based in Colombo at the inception of the SHIFT1 and punctual specific
missions according to NWSDB requirements throughout the duration of the
SHIFT1.

Funding Arrangements

Funds under the SHIFT I project have been allocated as indicated in the table 1 below;

Description AFD GOSL EU

SHIFT 1 Component 1: for Negombo city 57.5 26

Component 2 : for Galle city and 6.0

Kelaniya- Peliyagoda area

Sewerage office building 2.5

Component 3 : Technical assistance and 5.7

Risk and Contingencies 10

Total for SHIFT 1

SHIFT 2 Galle 54.2 17.4

&3

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Progress Report SHIFT Project

Kelaniya / Peliyagoda 64.2 22.6

Total 194.4 66.0 5.7

2. Project Preparation

Formulation of SHIFT project was initiated in 2014 and AFD Board approval for the
project was received in January 2015. Also the grant from European Union for the
technical assistance was received to AFD in the same year. Due to prolong duration
which had been taken for the loan negotiation process with the External Resource
Department, Attorney General and the funding organization the loan agreement was
signed in 1st June 2016 between AFD and the Government of Sri Lanka. The grant
agreement for the technical assistance component was signed in 16 th March 2016.
Later a subsidiary loan agreement was signed between National Water Supply &
Drainage Board and the Government of Sri Lanka on 13th October 2016.

Accordingly, the implementation of SHIFT 1 project will be done by the NWSDB which
has appointed a separate Project Management Unit (PMU) in this regard. After the
loan Agreement was signed, the process of appointing staff for the PMU was started.
Project Director was appointed on 01.11.2016.For the formulation of PMU, a new
building was rented at No.38, Charles Place, Rawathawatta and office furniture,
equipment & other facilities were acquired. Later the PMU was established on
09.01.2017 after appointing other staff members including a Chief Engineer, two civil
Engineers and other supporting staff.

MANAGEMENT SUPPORT CONSULTANCY (MSC)

1. General Information:
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Progress Report SHIFT Project

a. Name of the Management Support Consultancy (MSC)

Contract
b. Description of The MSC aims at supporting PMU in the implementation of
the Mission the SHIFT1 and in building capacities in the field of project
management. The estimated implementation duration of the
MSC mission is 60 months. It will comprise a residential
technical assistance based in Colombo at the inception of the
SHIFT1 followed by punctual specific missions according to
NWSDB requirements
c. Contract No. P&D/RFP/AFD/SHIFT-1/MSC/2016/02

d. Name of the M/S Egis Eau, France

Consultant
e. Date of Award f. Scheduled date of June 2022
27/10/2017 completion
g. Contract h. Accepted Contract Euro 1,002,645.95 plus
Commencement 14/11/2017 Amount SLRs 5,830,000.00 plus
Date: VAT & NBT

2. Current Status:
• Bid issued to short listed firms on 16.12.2016 and closed on
06.02.2017.
• CPCC approval for Technical Evaluation was received on
02.05.2017.
• AFD granted no objection for the Technical Evaluation on
15.05.2017 and opened financial proposal on 19.05.2017.
• AFD granted no objection for negotiation with the selected bidder
for the Financial Evaluation on 16.06.2017.
• CPCC Approvals for the selected consultant after negotiation
was received on 24.07.2017.
• AFD no objection for the negotiated bid price of the contract was
received on 25.08.2017.
• Referred to Ministry of CP&WS to obtain Cabinet Approval on
28.08.2017.
• Obtained approval of the Cabinet of Ministers to award the
contract on 03.10.2017.
• Contract award on 27.10.2017 and consultant mobilized on
14.11.2017.
• Consultant submitted their work schedule.

3. Progress of Consultancy Service:

a. Summary
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Progress Report SHIFT Project

Local/ International/AFD

Planned Actual

Cumulative 8% 2.5%
Physical Progress

Cumulative 20% 0%
Financial Progress

b. Descriptive Details of Physical Progress

Consultant has submitted their work schedule for the project period.

c. Descriptive Details of Financial Progress

Disbursements Made:

Financial Source Date Payment

GOSL LKR

AFD EURO

DESIGN AND SUPERVISION CONSULTANCY (DSC)

1. Contents of the Project:

a. Name of the Design and Supervision Consultancy (DSC)

Contract
b. Description of
the Mission The purpose of the assignment is to prepare technical studies
up to preparation of Bidding Documents for Negombo, Galle-
Unawatuna and Kelaniya-Peliyagoda wastewater
management projects and perform works supervision for
Negombo wastewater management project under the SHIFT
program.
The contract for the services will include two phases : (i) a
Confirmed Tranche which will be paid with the proceeds of the
financing already secured for SHIFT1 ; and (ii) an Optional
Tranche which will be paid with the proceeds of the financing
that NWSDB will mobilize for SHIFT2. The Optional Tranche
will come into force after NWSDB’s approval based on its
appreciation of the execution of the Confirmed Tranche.

c. Contract No. P&D/RFP/AFD/SHIFT-1/2016/01

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Progress Report SHIFT Project

d. Name of the Yet to be decided

Consultant
e. Date of Award f. Scheduled date of
completion
g. Contract h. Accepted Contract
Commencement Amount
Date:

2. Current Status:
• RFP was issued to short listed consultants on 13.02.2017 and
closed on 23.05.2017.
• CPCC evaluated technical proposal and sent to AFD on 16th
June 2017 for no objection
• AFD objected on the technical evaluation based on some
factors and requested to re-evaluate the Technical Evaluation
on 28th July 2017
• CPCC approval for second evaluation of the Technical Proposal
was received on 19.08.2017.
• No objection for the Technical Evaluation from AFD was
received on 23.08.2017.
• Financial Proposal opened on 31.08.2017.
• Due to debarment of originally selected consultant, 2nd financial
evaluation was done on 08.11.2017.
• CPCC approval for the 2nd Financial Evaluation report was
received on 13.11.2017.
• No objection for the Financial Evaluation from AFD was
received on 23.11.2017
• Contract Negotiations with consultant held on 07.12.2017.
• Waiting for CPCC Approvals for the selected consultant.

4. Progress of Consultancy Service

a. Summary

Local International/AFD

Planned Actual Planned Actual

Cumulative
Physical Progress Contract yet to

Cumulative
Financial Progress

b. Descriptive Details of Physical Progress

c. Descriptive Details of Financial Progress
Disbursements Made:

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Progress Report SHIFT Project

Financial Source Date Payment

GOSL LKR

AFD EURO

POLICY AND INSTITUTIONAL ENHANCEMENT CONSULTANCY

(PIEC)
1. Contents of the Project:
a. Name of the Policy and Institutional Enhancement Consultancy (PIEC)
Contract
b. Description of The objective of the PIEC is to: (a) provide recommendations
the Mission to enhance the policy and institutional framework for the
sewerage sector; (b) provide recommendations to improve
the water supply and sewerage sector financial viability,
assist NWSDB in accounting analyses as part of the change
to IFRS, develop a NWSDB financial model and realize a
tariff study for the water supply and sewerage sector; (c)
design the content and assist in the procurement of the
Sewerage Management Skills Development Consultancy
(SMSDC). The estimated implementation duration of the
PIEC mission is 13 months.
c. Contract No. P&D/RFP/AFD/SHIFT-1/PIEC/2016/01
d. Name of the Yet to be decided
Consultant
e. Date of Award f. Scheduled date of
completion
g. Contract h. Accepted Contract
Commencement Amount
Date:

2. Current Status:
• RFP was issued to short listed consultants on 20.02.2017 and
closed on 02.05.2017.
• CPCC approval for the Technical Proposal was received on
06.07.2017.
• AFD commented on the technical evaluation on 10th Aug. 2017
• CPCM revisited the evaluation based on AFD comments and
replied to AFD on 28th Aug. 2017
• AFD no objection for the Technical evaluation was received on
18.09.2017 and Financial proposals opened on 3rd October
2017.
• CPCM has pointed out the fact in the financial proposal of M/S
Hydroconseil, the amount indicated in FIN-1 does not match
with the amount in FIN-2. Accordingly CPCM decided to not to
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Progress Report SHIFT Project

consider the financial proposal of the above bidder for further

evaluation.
• By considering clause 24.1.2 in “Instruction to consultant”, AFD
invites the CPCM to consider the Financial Proposal of the
above bidder and review the evaluation and amend the report
accordingly.

Progress of Work:
a. Summary

Local International/AFD

Planned Actual Planned Actual

Cumulative
Physical Progress
Cumulative
Financial Progress

b. Descriptive Details of Physical Progress

c. Descriptive Details of Financial Progress

Disbursements Made:

Financial Source Date Payment

GOSL LKR

AFD EURO

SEWERAGE MANAGEMENT SKILLS DEVELOPMENT

CONSULTANCY (SMSDC)

1. Contents of the Project:

a. Name of the Sewerage Management Skills Development Consultancy
Contract (SMSDC)
b. Description of In line with the infrastructure investments forecast in the
the Mission sewerage area in the country, NWSDB will have to face two
big challenges: (i) develop the capacities to operate and
maintain large-scale wastewater systems and (ii) develop a
strategy to recruit and train approximately 400 people for the
Sewerage Department in the next six years. The SMSDC
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Progress Report SHIFT Project

aims at supporting NWSDB to face those two big challenges.

It will comprise a support in HR management, day-to-day on
ground training at management and technical level, and
development of sewerage courses. The estimated
implementation duration of the SMSDC mission is 36 months.
The SMSDC will be endowed with an equipment fund. The
content of the SMSDC will be designed with the support of
the PIEC Consultant. Hence, the Consultant selected for the
PIEC will not be able to tender for the SMSDC.
c. Contract No.
d. Name of the
Consultant
e. Date of Award f. Scheduled date of
completion
g. Contract h. Accepted Contract
Commencement Amount
Date:

2. Current Status:
TOR of this consultancy will be prepared by PIEC consultants

3. Progress of Work:

a. Summary

Local International/AFD

Planned Actual Planned Actual

Cumulative
Physical Progress

Cumulative
Financial Progress

b. Descriptive Details of Physical Progress

c. Descriptive Details of Financial Progress

Disbursements Made:

Financial Source Date Payment

GOSL LKR

AFD EURO

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Progress Report SHIFT Project

CONSTRUCTION OF COLLECTION SYSTEM WITH PUMP HOUSES

FOR NEGOMBO WASTEWATER DISPOSAL SYSTEM

1. Contents of the Project:

i. Name of the Construction Of Collection System With Pump Houses
Contract For Negombo Wastewater Disposal System
j. Description of The purpose of the contract is to construct a collection
the Contract network and pump houses for the Negombo
wastewater Management project. This will be a works
contract.
k. Contract No.
l. Name of the
Consultant
m. Date of Award n. Scheduled
date of
completion
o. Contract p. Accepted
Commencement Contract
Date: Amount

2. Current Status:
None

3. Progress of Work:

a. Summary

Local International/AFD

Planned Actual Planned Actual

Cumulative
Physical Progress

Cumulative
Financial Progress

b. Descriptive Details of Physical Progress

c. Descriptive Details of Financial Progress

Disbursements Made:

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Progress Report SHIFT Project

Financial Source Date Payment

GOSL LKR

AFD EURO

Design & Construction of Wastewater Treatment Plant (TP) & Main

Pump House (MP), Construction of Sea outfall , Procurement of O&M
Equipment for Treatment Plant & Main Pump house and
Construction of O&M facilities in Negombo Wastewater Disposal
System

1. Contents of the Project:

a. Name of the Design & Construction of Wastewater Treatment Plant (TP) &
Contract Main Pump House (MP), Construction of Sea outfall ,
Procurement of O&M Equipment for Treatment Plant & Main
Pump house and Construction of O&M facilities in Negombo
Wastewater Disposal System .
b. Description of The purpose of this contract is to design and construct
the Contract wastewater treatment plant, Design and construct sea outfall,
Procurement of O&M Equipment for Treatment Plant & Main
Pump house and Construction of O&M facilities in Negombo
Wastewater Disposal System. This will be a Design and Build
contract.
c. Contract No.
d. Name of the
Consultant
e. Date of Award f. Scheduled date of
completion
g. Contract h. Accepted Contract
Commencement Amount
Date:

2. Current Status:
None

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Progress Report SHIFT Project

3. Progress of Work:
a. Summary

Local International/AFD

Planned Actual Planned Actual

Cumulative
Physical Progress

Cumulative
Financial Progress

b. Descriptive Details of Physical Progress

c. Descriptive Details of Financial Progress

Disbursements Made:

Financial Source Date Payment

GOSL LKR

AFD EURO

Pro-Poor Fund and NGO

1. Contents of the Project:

a. Name of the Pro-Poor Fund and NGO
Contract
b. Description of The first phase of the SHIFT Project (SHIFT 1) will also
the Mission finance the project NGO whose role will be to promote
hygiene, best practices of water use and civil society
participation. SHIFT 1 will also comprise a pro-poor fund that
will ensure that all low incomes households could be
connected to the reticulation system.
c. Contract No.
d. Name of the
Consultant
e. Date of Award f. Scheduled date of
completion
g. Contract h. Accepted Contract
Commencement Amount
Date:

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Progress Report SHIFT Project

2. Current Status:

None

3. Progress of Work:
a. Summary

Local International/AFD

Planned Actual Planned Actual

Cumulative
Physical Progress

Cumulative
Financial Progress

b. Descriptive Details of Physical Progress

c. Descriptive Details of Financial Progress

Disbursements Made:

Financial Source Date Payment

GOSL LKR

AFD EURO

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Progress Report SHIFT Project

The contents of this report are the sole responsibility of the Project Management Unit
and can in no way be taken to reflect the views of the Agence Française de
Développement (AFD) and the European Union

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