tor maros - transaction advisory

8/10/2019 TOR Maros - Transaction Advisory

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Request for Expressions Of Interest

INFRASTRUCTURE REFORM SECTOR DEVELOPMENT PROJECT (IRSDP)

Loan ADB No.2264-INO (SF)

Date : 29 November 2010

REQUEST for EXPRESSIONS OF INTEREST (EOI)

The Government of Indonesia (GOI) under support from the Asian Development Bank will implement TheProject Development Facility (PDF). This PDF provide funding for the preparation and bidding of smaller-scale decentralized regional infrastructure projects.

Objectives:

By using PDF Assistance, the Local Government of Maros envisages to award a "Maros Water SupplyProject " to a credible company as a concessionaire to design, build, finance, operate and transfer a bulkwater treatment facility and associated main pipeline to supply PDAMs over a reasonable period of time.

The main objective of consultant servicesare to (i) ensure the readiness of the project for offer to themarket; (ii) confirm the technical feasibility and attractiveness of the project for private investment; (iii)propose project financing structure based on a PPP modality; (iv) confirm affordability of the project toPemkab Maros; (v) develop a Bid Implementation Plan including comprehensive bidding documents; (vi)

assist with the execution of the Bid Implementation Plan.

Scope of Services:Based on the described objective, the consultant will support the TIM KPS in a number of areas, includingbut not limited to:

a. Stage I: Final Business Caseb. Stage II: Bid ImplementationPlease refer to the Term of Reference (TOR) for detailed information.

Duration for consul ting services assignment (10 months):-It is estimated about 11.5 person-months of national consultant inputs and 0.8 person-months of international

consultant inputs will be required for stage I and 21.5 person-months of national consultant inputs and 1.2 person-months of international consultant inputs for stage II;

Selection Method for Firms:Consultants' Qualifications Selection under ADB Guidelines.

Type of Proposal Requested from Firms: Biodata Technical Proposal.

Term of Payment:Output Based.

The procurement committee of Bappenas, invites eligible qualifiedConsultant Firmsto provide the services of:

Transaction Advisory Services for Maros Water Supply Project

The Consultant Firms who has qualified for the projects should submit their EOI separately provided in hardcopy oneoriginal EOI and two copies. The EOI should indicate their qualification to perform the services such as relevantexperience in last 5 years, qualification and competency of key personnel, company profile, legal document, etc, using


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Template for Consulting Firms1Expression of Interest (EOI) submission

Project NameT r a n s a c t i o n A d v i s o r y S e r v i ce s f o r M a r o s Wa t e r Su p p l y

P r o j e c t

Project Country Indonesia

I. Eligibility

Declaration

We2hereby declare that:

(i) we acknowledge that we have read the advertisement, including the terms ofreference (TOR), for this assignment and fully acquainted myself with all mattersrelating to the Government of Indonesias Policy with respect to Public PrivatePartnerships (PPP);

(ii) we have not been engaged to prepare such TOR as a firm, association, or joint

venture; and(iii) no full-time or part-time or contracted expert employed by our firm, association,

or joint venture has been engaged to prepare such TOR.

We further confirm that, if any of one or more of our experts is engaged to prepare TORfor any ensuing assignment as part of our work product under the assignment to whichthis advertisement relates, our firm and any such expert(s) will be disqualified fromshort-listing and/or participation in such follow-on assignment.

Lead Firm CMS Registration Number:3

Signed by:Position :

Associate/Partner 1 CMS Registration Number:3

Signed by:Position :

Associate/Partner 2 CMS Registration Number:3

Signed by:Position4 :


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II. Management Competence (Please answer each question in no morethan 10 sentences)

a. Provide the name, qualifications and relevant experience of the lead firmsdirector or manager who will assume overall responsibility for the firms,associations or joint ventures team coordination, management and output.

b. If you are proposing an association or a joint venture, outline the rationalefor, and benefits to the assignment of, the arrangement.

c. If you are proposing an association, or a joint venture, outline proposedmanagement coordination of the arrangement, including the role of each firm.

d. Does your firm/association/joint venture have standard policies,

procedures or practices in place that promote quality in: the workplace, yourinteraction with clients, and the outputs you produce? If yes, describe briefly.


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III. Technical Competence

Narrative DescriptionsWith reference to the attached project sheets, and in the context of the assignmentsTORs, summarize the relevant technical qualifications of your firm/association/jointventure (maximum of 2 pages).


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IV.

Geographical Competence

Outline the country /regional experience of the firm/association/joint venture

(maximum of one half page).


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Appendix 1

Project Sheets

Indicate up to 10 reference projects from the past 5 years that the firm/association/jointventure feels are relevant. You may refer to your Consultant Management System (CMS)registration projects sheets for additional information.4

Project 1 of __

Project Name

Name of Client

Country Project location within Country

Participation

As lead firmAs associate firm

Value of Services (US$)

Source of Financing

Consultancy Services

(i) No. of staff

(ii) No. of person months

Length of Consultancy AssignmentStart Date (dd/mm/yyyy)

Completion Date (dd/mm/yyyy)

Name of Associate Firms (if any)

No. of Person-Months of Professional Staff Provided by Associated Firm(s)

Name of Senior Staff (Project Director/Coordinator, Team Leader) Involved and FunctionsPerformed

Detailed Narrative Description of the Project

Detailed Description of the Actual Services Provided by your Firm


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Appendix 2

Additional Information


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REPUBLIC OF INDONESIA

MINISTRY FOR NATIONAL DEVELOPMENT PLANNING/

NATIONAL DEVELOPMENT PLANNING AGENCY

TERMS OF REFERENCE

TR NS CTION DVISORY SERVICES FOR

M ROS W TER SUPPLY PROJECT


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TERMS OF REFERENCE

TRANSACTION ADVISORY SERVICES FOR

MAROS WATER SUPPLY PROJECT

TABLE OF CONTENTS

1 OBJECTIVES AND PURPOSE OF THE ASSIGNMENT ........................................................ 7

1.1 ROLE OF BAPPENAS AND THE PDF ...................................................................................... 7

1.2 REQUEST FROM THE GOVERNMENT CONTRACTINGAGENCY (GCA) ...................................... 7

1.3

BACKGROUND .................................................................................................................... 7

1.4 PROJECT RATIONALE.......................................................................................................... 7

1.5 THE PROPOSED PROJECT WORKS....................................................................................... 8

1.6 SITE ENABLEMENT.............................................................................................................. 9

1.7 PRE-CONDITIONS FOR STAGE 2:BID IMPLEMENTATION......................................................... 9

1.8

OBJECTIVES OF THEASSIGNMENT....................................................................................... 9

2 SCOPE OF WORK ................................................................................................................ 10

2.1 STAGE I: FINAL BUSINESS CASE....................................................................................... 10

Deliverable 1: Project Preparation Report ............................................................................. 10

Task 1.1: PPP Project Readiness Assessment .................................................................... 10

Task 1.2: Institutional Capacity Assessment ......................................................................... 10

Deliverable 2: Final Business Case....................................................................................... 11

Task 2.1: Project Rationale ................................................................................................... 11


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Maros Water Supply Project ToR Transaction Advisory

Task 2.8: Financial and Economic Analysis ........................................................................... 13

Task 2.9: Investor and Financial Market Assessment........................................................... 14

Task 2.10: Government Support Analysis .............................................................................. 14

Task 2.11: Tariff and Financing Structure .............................................................................. 15

Task 2.12: PDAM Performance Contract Agreement ........................................................... 16

Task 2.13: Draft Term Sheet .................................................................................................. 16

Task 2.14: Bid Implementation plan ....................................................................................... 17

Deliverable 3: Presentation of the Final Business Case ....................................................... 18

2.2 STAGE 2:BID IMPLEMENTATION......................................................................................... 18

Deliverable 1: Bid Documents ............................................................................................... 18

Task 1.1: Draft Project Agreement and Supporting Documents ........................................... 18

Task 1.2: Tender Guidelines .................................................................................................. 19

Task 1.3: Draft Bid Documents .............................................................................................. 20

Task 1.4: Establish secure online data room ......................................................................... 20

Task 1.5: Detailed Bid Implementation Plan ......................................................................... 21

Task 1.6: PPP Agreement Management Plan ...................................................................... 21

Deliverable 2: Assistance with Bid Process .......................................................................... 21

Task 2.1: Alert Potential Bidders ........................................................................................... 21

Task 2.2: Pre-Qualify Bidders ................................................................................................ 21

Task 2.3: Finalize Project Structure and Procedures for Evaluating Bidders ........................ 22

Task 2.4: Contract Negotiations and Concession Award ....................................................... 22

Task 2.5: Post-Award Negotiations ....................................................................................... 23


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7

INPUTS TO BE PROVIDED BY GOVERNMENT ................................................................. 26

8 BUDGET ................................................................................................................................ 26

9 ASSIGNMENT SCHEDULE ................................................................................................... 27

TABLES

Table 1: Pre-Conditions to be satisfied prior to commencing Stage 2: Bid Implementation ........... 9

Table 2: Deliverable Items and Terms of Payment ....................................................................... 23

Table 3: Qualifications of Staff ...................................................................................................... 24

Table 4: Illustrative Staff Inputs ..................................................................................................... 25

Table 5: Budget Estimate for Services (US$) ............................................................................... 27


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GLOSSARY OF TERMS ANDABBREVIATIONS

Term Meaning

ADB Asian Development Bank

Bappeda Badan Perencanaan dan Pembangunan Daerah (Regional Development Planning

Agency)

Bappenas Badan Perencana den Pembangunan Nasional (National Development Planning

Agency)

BKPM Badan Koordinasi Penambaan Modal (Investment Coordination Board)

BPPSPAM Penyehatan Badan Pendukung Pengembangan Sistem Penyediaan Air Minum

(National Water Supply System Development Supporting Agency)

BOT Build, Operate and Transfer

CA Cooperation Agreement

DGHS Directorate General Human Settlements (DJCK)

ECA Export Credit Agency

EIRR Economic Internal Rate of Return

EOI Expression of Interest

Facility The Facility will comprise the intake, raw water transmission pumping station and

rising main, water treatment plant, service reservoir, trunk water mains, and

associated appurtenances

FBC Final Business Case1

FIRR Financial Internal Rate of Return

GCA Government Contracting Agency

GoI Government of Indonesia


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IDR Indonesia Rupiah

IIGF Indonesian Infrastructure Guarantee Fund

IIFF Indonesian Infrastructure Financing Facility

IM Information Memorandum

IRSDP Infrastructure Reform Sector Development Project

JICA Japan International Cooperation Agency

KKPPI Policy Committee for Accelerating the Provision of Infrastructure (Komite Kebijakan

Percepatan Pembangunan Infrastuktur)

KPS Kerjasama Permerintah Swasta (PPP)

MLA Multi Lateral Agency

MoF Ministry of Finance

NRW Non-Revenue Water

OBC Outline Business Case

P3CU PPP Central Unit

PDAM Perusahan Daerah Air Minum (Local Water Authority)

PemKab Pemerintah Kabupaten (Local Government)

PII (PT) Penjamin Infrastruktur Indonesia (Perseroan Terbatas)

PJPK Penanggung Jawab Proyek Kerjasama (GCA)

PPC Project Preparation Consultant (PT Waseco Tirta and PT Multi Area Desentralisasi

Pembangunan)

PPP Public Private Partnership (KPS)

Project Maros Water Supply Project

PSO Public Service Obligation


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SPV Special Purpose Vehicle

SOE State Owned Enterprise

TAS Technical Advisory Services (provided by Bappenas through the IRSDP)


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1 OBJ ECTIVES AND PURPOSE OF THE ASSIGNMENT

1.1 ROLE OF BAPPENAS AND THE PDF

1. Bappenas, through the Project Development Facility (PDF) Steering Committee, has approved theuse of the PDF to fund the preparation for the Development of the Maros Water Supply Project under theterms of this TOR. The PDF is part of the Infrastructure Reform Sector Development Project (IRSDP).The Project Management Unit (PMU) responsible for the implementation of the IRSDP is seeking toappoint consultants (henceforth the Consultant) to conduct the proposed further study and assist with thesubsequent bid implementation (henceforth the Transaction) in accordance with Perpres 67/2005 and13/2010 and Bappenas Ministerial Regulation 3/2009. The project is categorized as a potential project.

2. The Government Contracting Authority (GCA) for the proposed Public Private Partnership (PPP)project is the local government of Kabupaten Maros. The PemKab Maros will be responsible forsupervising and monitoring the performance of the Consultant through a technical team functioning asthe PPP Project Implementation Unit. The PMU-IRSDP will assist in the overall supervision andmonitoring on technical matters via TAS (Technical Advisory Services), which is under the PMU.

1.2 REQUEST FROM THE GOVERNMENT CONTRACTING AGENCY (GCA)

3. The Study is being prepared pursuant to a request from the Local Government of Kabupaten Maros,hereinafter referred to as the Government Contracting Authority (GCA), as detailed in a letter ref.600.58/FS.Bappeda.III.2010 of March 12, 2010.

1.3 BACKGROUND

4. Within Kabupaten Maros piped water supply services are provided by PDAM Kabupaten Maros. Thecoverage of piped systems in these areas is currently considered by the Local Government to be too low.

5. Problems associated with water supply have received considerable attention, not only from the LocalGovernments, but also the Provincial and Central Governments. In recent years considerableassistance has been provided by the Government of Japan through JICA. Substantial technicalassistance has been provided on a project entitled MAMINASATA Water Supply Project.

1.4 PROJECT RATIONALE

6. The total population of Kabupaten Maros is some 300,000 persons. The current level of the pipedwater supply service is 23% of the population. The existing systems have a production capacity of 130l/sec with NRW at around 40%.


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9. In accordance with PemKab objectives, the Project therefore proposes to provide additionalproduction capacity of some 250 l/sec along with some additional trunk mains within the distributionsystem.

10. The Project will help support commercial and industrial development in the area and hence generateeconomic growth. It will also improve the quality of life and public health for the residents. Theobjectives of this PPP include the following:

provision of bulk treated water which will enable increased coverage of piped drinking water

supply systems in strategic areas of Kabupaten Maros;

increased private sector involvement in piped water supply systems leading to:

o reduction of the need for government to invest capital in developing new assets;

o realization of cost savings, particularly in the:

- reduction of design and construction times,

- reduction of the risks in project cost overruns, and

- quicker and more efficient decision-making in the implementation processes;

o improved financial, commercial management and operational expertise of piped drinkingwater supply systems;

o reduced costs for the water supply services arising from higher productivity andeconomies of scale through expanded coverage; and

o sharing or reducing to a minimum the project risks to government.

1.5 THE PROPOSED PROJECT WORKS

11. Two major sources of water have been considered for future supplies to Maros. These are theBantimurung River and the Maros River. The former has been assessed as providing a cheaper sourceof water; however, the amount of available debit is limited to 250 l/sec.

12. Briefly, the project water supply system components consist of:

Intake: capacity 270 l/s. Intake will be equipped with a pumping system to deliver theraw water to the WTP.

Raw Water Transmission: transmission main of 8.5 km length and 500 mm diameter;


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1.6 SITE ENABLEMENT

13. The area of the intake requires land acquisition of around 1,000 square meters and the WTP andService Reservoir requires some 7,500 square meters. The PDAM reports in its letterRef.:54/PDAM/MR/X/2010 dated October 28, 2010, that the land for the intake has been acquired,however the land for the WTP and Service Reservoir has yet to be acquired.

14. The considerable lengths of transmission main are expected be constructed on public land.

15. The project is classified as Category A: Requiring an Environmental Impact Assessment (EIA),Environmental Management Plan and Public Consultation. Initial environmental investigations haveindicated that the project should not face any significant problems from an environmental viewpoint.

1.7 PRE-CONDITIONS FOR STAGE 2: BID IMPLEMENTATION

16. The following table represents a summary of the current status of fundamental items which shouldbe secured before the project preparation proceeds to the bid implementation stage.

Table 1: Pre-Conditions to be satisfied prio r to commencing Stage 2: Bid Implementation

Item Description Responsible Remarks

1 Approval for abstraction of rawwater (SIPA) fromBantimurung River in theproposed quantity and rate.

SDA - Dinas PUProvince SulawesiSelatan

Preliminary approval for the proposedabstraction has been obtained. A SIPA hasbeen issued by the PemKab, however thisrequires confirmation from the ProvincialGovernment Agency.

2 An undertaking that landacquisition for any private landrequired for the watertreatment plant, pumpingstations, service reservoirsand pipelines will becompleted prior to bidding theproject.

PemKab Maros The Local Government of Kabupaten Maroshas to acquire the necessary land forconstruction of the intake, WTP, servicereservoir and associated facilities.

3 The level of directGovernment Support, if any,for development of the

facilities.

DG WaterResources

To make the Project financially viable thepreliminary proposal is for the intake and rawwater transmission to be provided by the

Government. The proposed GovernmentSupport needs to be confirmed through thelocal PSDA.

4 Confirmation-in-principle fromPemKab Maros that it isprepared to enter into a takeor pay agreement.

PemKab Maros Agreement for take or pay has beendiscussed with PemKab but formal agreementon the approach has to be provided.


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Determine the status of land acquisition and resettlement programs, environmentalclearances; prepare a draft scoping report and TOR for AMDAL; clarify the approvalsprocess for construction of transmission mains and related facilities in public reserves;assess overall project readiness.

Update the Project plan setting out key milestones for components, including approvals,design, construction, commissioning and operation.

TASK 2.5: LEGAL DUE DILIGENCE

Evaluate the legal/regulatory framework for the special purpose vehicle which will beestablished by the private sector and identify any impediments to mobilizing finance inareas such as taxation.

Assess potential restrictions on local and foreign sponsors and potential lenders in areassuch as competition, tax, labor, use of financial instruments, and foreign exchange.

Identify the mechanism for arbitrating disputes between the SPV and the PemKabMaros.

Determine the extent to which the PemKab Maros can contract with the private sectorestablish an escrow account, and provide forms of credit enhancement to support theproject.

Clarify legal requirements with regard to bid documents, bid evaluation procedures andcriteria which the PemKab Maros must comply with to tender a PPP contract.

TASK 2.6: DETAILED OUTPUT SPECIFICATION

Prepare a description of the broad functional content of the Project.

Define the key service relationships and the interaction of the critical elements of servicedelivery including the scope of the concession contract, the obligations of both theconcessionaire and the PemKab Maros.

Prepare a detailed list of assumptions with regard to the formulation of the BusinessCase including those relating to the technical design as well as those used in thefinancial analysis.

Define the proposed tariff, terms of payment and penalty structure.


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o Balance sheet

o Cash flow statement

o Financial indicators

Scenario results should be presented in Rp

Evaluate defined scenarios and risk allocation structures in relation to the followingindicators:

o Tariffs

o FIRR

o FNPV

o ROE > 17%

o

Debt Service Coverage Ratio (DSCR) > 1.3

Conduct a sensitivity analysis and identify the impact on the ROE and other financialindicators.

Calculate the EIRR in accordance with Government requirements.

Assess the probability and impact of major risks and propose adequate risk mitigationmeasures.

Assess if there are any significant changes to the project EIRR under the variousscenarios.

TASK 2.9: INVESTOR AND FINANCIAL MARKET ASSESSMENT

Interview potential local and international investors and assess their attitude to projectrisks and likely minimum levels of Government support which are proposed.

Interview local financial institutions to determine if credit is available on the local marketand on what terms.

Prepare a report summarizing the views expressed at these meetings.

TASK 2 10: GOVERNMENT SUPPORT ANALYSIS


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Define timing and value of payments from the PemKab Maros.

Assess the need to ring fence tariff revenues, identify requirements for establishing anescrow account and trust bank, define cash flow priorities, billing procedures, accountingand reporting requirements, and management information system needs.

Assess other likely forms of arrangements that will be needed by financiers in terms ofsecuring cash flows, and managing risks in the event of a change in ownership orinsolvency (eg direct agreement with the PemKab Maros defining step in rights), or force

majeure (natural disaster or political turmoil).

Define pre-conditions for concessionaire to meet service obligations, default and risksclauses, step-in rights for the lenders etc.

Establish benchmarks for bid evaluation framework in terms of output costs,competitiveness and affordability of PemKab Maros support.

TASK 2.12: PDAM PERFORMANCE CONTRACT AGREEMENT

Draft a Performance Based Contract Agreement between the PemKot and the PDAMwhich defines, at a minimum, the following:

o Payment terms to PemKab for bulk water supplied by the SPV to the PDAM

o Increased coverage milestones to be achieved

o NRW improvement activities and targets

o Service levels to be maintained:

- Quality of water supplied

- Continuity of service

- Minimum water pressure in the system

o Human resources management policies and capacity building requirements

o Efficiency and effectiveness of tariff collection operations

o Operations and maintenance requirements

o Safety performance requirements


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o Nature and extent of Government Support

o Minimum revenue/payment guarantee provisions

o Procedure for setting and adjusting user fee/tariff over time

o Provisions relating to competing facilities

o Estimated capital costs, construction period

o Status of Land acquisition program

o Health, Safety, Social and Environment Requirements

o Provisions for change of scope

o Provisions for clawback payments by the concessionaire

o Provisions relating to escrow account

o Provisions relating to insurance

o Provisions relating to assignment/substitution rights relating to lenders

o Provisions relating to audit and certification

o Provisions relating to change in the law

o Provisions for compulsory buyback of assets at termination/expiry

o Contingent liabilities for the Government

- Maximum termination payment for Government default

- Maximum termination payment for concessionaire default

- Any other penalties proposed under the agreement

o Proposed dispute resolution mechanism

o Proposed governing law and jurisdiction

o Conditions precedent

o Maximum period for achieving financial close

o Need for an Independent Engineer to monitor construction


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Detail institutional requirements to manage and implement the bid process.

Define requirements in terms of bid documents.

Prepare a list of potential bidders and detail bid evaluation criteria.

Prepare the bid implementation plan, management responsibilities timeline for bidprocess and resource needs.

DELIVERABLE 3: PRESENTATION OF THE FINAL BUSINESS CASE

Prepare a Final Business Case that consolidates the findings of the Outline BusinessCase and the above listed tasks.

On completion of the Final Business Case, the PemKab Maros with assistance from theConsultant is to present the Project to BAPPENAS and Ministry of Finance.

Once concurrence of all parties is received to the proposal, the Consultant is to proceedwith the Bid Implementation phase of the Project.

2.2 STAGE 2: BID IMPLEMENTATION

DELIVERABLE 1: BID DOCUMENTS

TASK 1.1: DRAFT PROJECT AGREEMENT AND SUPPORTING DOCUMENTS

The draft Project Agreement should contain at least the following provisions:

o Structure and description of the contracting body

o Scope of the project, output definition, payment structure, performancestandards, provisions for change

o Transfer of assets

o Implementation schedule

o Length of the contract, breaks, triggers and renewal clauses

o Monitoring and supervision arrangements


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o Step-in rights for the lenders, allowing them to substitute another serviceprovider if the supplier defaults

o Force majeure and termination provisions

o Termination payment (eg 100% debt, plus equity in accordance with costsincurred on project implementation costs defined in the bid documents)

o Governing law and dispute resolution mechanism

o Role and scope of work of the Independent Consultant who will monitor projectimplementation on behalf of the Government

Support documents including:

o The land lease and raw water supply agreements, defining factors such asscope, availability provisions and payment terms

o Market analysis and feasibility studies

o Draft TOR for the AMDAL and Draft Resettlement Plan

o Details of existing contractual commitments.

TASK 1.2: TENDER GUIDELINES

Prepare guidelines for the Government to run the tender, providing information on:

o

General overview of how the tender should be set up, organized, and run

o How the tender should be advertised

o Who should run the tender and the probity procedures that should be followed

o Information that should be provided to potential concession bidders, the form ofdata room forum and confidentiality conditions

o Information that should be requested from the potential bidders

o Define two stage bidding process with prequalification required and pre-bidconference required

o The need for and where necessary amount of a bid bond

o The criteria which should be used to evaluate the PPP bids and the scoring


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o Procedure to conduct negotiations

o Forms of documentation which should be exchanged and when during thetendering process

o Rules of conduct and protocol for conducting the bidding process

o Procedure to handle unsolicited or non-compliant proposals

o Procedure to handle conflicts of interest

o Procedure to handle mistakes, omissions, protests, leaks, and other untowardevents that may occur during the tender process

o Proposed tender time-table

o Checklist of information to be provided to potential bidders

TASK 1.3: DRAFT BID DOCUMENTS

The draft bid documents should include the following:

o Advertisement for the PPP tender

o Information Memorandum (IM)

o Request for Expression of Interest (EOI)

o Request for Proposal (RFP)

o Management Representation Letter

o Confidentiality Statement

o Instructions to bidders on selection criteria and the concession process

o Checklists for various phases of the bid process.

TASK 1.4: ESTABLISH SECURE ONLINE DATA ROOM

Prepare database and confidentiality agreements

Market analysis


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TASK 1.5: DETAILED BID IMPLEMENTATION PLAN

Work with the Procurement Committee established within the Project ManagementTeam to review, refine and approve proposed financial structure, bid strategy, bidevaluation criteria etc. Update bid implementation program identifying major milestones,decision points, responsibilities etc.

TASK 1.6: PPP AGREEMENT MANAGEMENT PLAN

Prepare a plan for management and administration of the PPP Agreement during thepost-transaction period - Phase IV: Contract Management. Provide an outline of thestructure, responsibilities and reporting requirements of all parties involved in this Phase.

DELIVERABLE 2: ASSISTANCE WITH BID PROCESS

TASK 2.1: ALERT POTENTIAL BIDDERS

Alert potential bidders through use of media to advertise project.

Issue Request for EOI

Hold informal pre-bid discussions

Identify any specific concerns that may need to be addressed in the bid documents andrevise draft RFQ, and other bid documents.

TASK 2.2: PRE-QUALIFY BIDDERS

Issue RFQ and IM that provides following information:

o Identification of what the Government hopes to achieve by implementing theproject,

o Definition of the type of outputs, payment structure and the scope of the project

o Description of market structure and regulatory arrangements

o Details of existing facilities and how they might be used in the project

o Details on preparatory work


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o Submission date and requirements

Hold Pre-Application Conference with prospective bidders

Following Application Due Date review RFQ submissions, verify submissions andevaluate in accordance with minimum standards of technical and financial capability

Identify and pre-qualify short list of prospective bidders based on qualifications (technicaland financial capacity) of bidders

TASK 2.3: FINALIZE PROJECT STRUCTURE AND PROCEDURES FOR

EVALUATING BIDDERS

Finalize Request for Proposal (RFP) describing the project, defining the PPP outputspecification, payment structure, performance standards, draft contract and supportagreements, information required from potential bidders to assess technical and financialcapacity, criteria for awarding the concession, and submission requirements (includingan electronic copy of the financial model of their proposal).

Finalize the procedure to deal with innovative non-compliant bids.

Finalize the procedure for dealing with requests for information, providing information tobidders and scope for negotiation.

Issue RFP and bid documents to prospective bidders.

Respond to requests for information in accordance with agreed procedures.

TASK 2.4: CONTRACT NEGOTIATIONS AND CONCESSION AWARD

Attend and assist with Closing of Tender on Bid Due Date.

Prepare a report on Bids Received including verification of adequacy and conformity ofbids and a bid evaluation; and select preferred bidder and standby bidder.

Assist with clarification/negotiation of the final terms of the PPP Agreement includingrequirements for Government support, conditions precedent, and term of the PPP

Agreement before it expires due to failure to achieve financial close.

Review proposed terms in the light of the assumptions in the Final Business Case toconfirm that they offer value for money and are affordable.


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Publish results and debrief unsuccessful bidders.

TASK 2.5: POST-AWARD AND FINAL PROJECT REPORT

Assist with compilation of PPP Project documentation

In collaboration with the GCA, prepare a Final Project Report documenting the complete

Stage 1 and 2 works and focusing on Lessons Learned in the execution of the

assignment.

DELIVERABLE 3: PRESENTATION OF FINAL PROJECT REPORT

The GCA with assistance from the Consultant is to present the Final Project Report to

BAPPENAS, Ministry of Finance and the ADB.

3 CONSULTANT DELIVERABLES

20. The contract is to be output based with lump sum payments made based on deliverable items. The

following table provides details of deliverables, due dates and portions of the contract sum which may be

claimed on successful completion, delivery and acceptance of each item.

Table 1: Deliverable Items and Terms of Payment

No. Deliverable/Milestone Due Date Terms of Payment

1 a. Mobilization 10%

b. Inception Report End of week 2 10%

c. Project Preparation Report End of week 3 10%

d. Draft Final Business Case End of week 7 50%


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21. All deliverables must be approved by Bappenas and endorsed by the ADB before submission ofinvoices for payment.

4 DURATION OF THE CONSULTA NCY

22. The Transaction Advisory services are expected to be provided over a period of approximatelytwelve months. Stage I is expected to take two months including a period for discussion and adoption ofthe Final Business Case Report. The timing requirements for Stage II will be confirmed at the end ofStage I. A preliminary estimate of the durations and sequencing of tasks is included in the attachedSchedule for Transaction Advisory.

5 OUTLINE REQUIREMENTS FOR THE CONSULTA NT

23. The Consultant is responsible for the provision of all professional and supporting staff necessary forthe satisfactory completion of the Services.

24. Minimum experts required for the implementation of assignment in terms of expertise, nationality and

qualifications are presented in Table 3: Qualifications of Staff. The precise experts required will beidentified in the specific terms of reference of IDCA.

Table 3: Qualifications of Staff

Consultant Nationality MinimumQualification

YearsExperience

Comments

Team Leader/ WSEngineer

National S1 10 Must have experience in PPP withinwater supply sector and the preparationand design of infrastructure projects.

TransactionSpecialist

International S2 10 Must have international experience infinance for, and deal structuring of, PPPinfrastructure projects

Legal Specialist National S2 (plus IzinAdvocat)

10 Experience in commercial law, preparinglease agreements, infrastructure projects

FinancialSpecialist

National S2 10 Experienced in preparing financial andeconomic models for water supplyprojects.

Social andEnvironmentalSpecialist

National S2 6 Experience in resettlement ininfrastructure sector; experience inpreparing IEA and familiar with AMDALrequirements

25. Team Leader- will have a water supply engineering specialization and experience and knowledge ofPPP. He/she will be responsible for coordinating all inputs of the Assignment, submission of reports tothe Government and Bappenas, facilitation of meetings and stakeholder consultations, as required, and


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Specialist will provide inputs into the output specification, the economic and financial model, contractspecification, and support technical aspects of the bid process.

26. Transaction/Financial Specialist - will have a financial specialization. He/she will review andvalidate the market studies and prepare a detailed financial model that can be used to evaluate theproject structure under various economic and financial scenarios. The Transaction/Financial Specialistwill take the lead in preparing the PPP structure and the Draft Term Sheets. During bid implementationthe Specialist will perform an over-seeing role in the preparation of the draft agreement and supportingdocuments, tender guidelines and bid documents. He will play a leading role in the bid evaluation and

negotiation activities.

27. Legal Specialist - will be responsible for performing the legal review, confirming project assets arefree of encumbrances, ensuring the required permits are in place, participating in stakeholderconsultations, developing bankability measures such as fee payment mechanism, defining pre-conditionsfor a private operator to fulfill in meeting service obligations, drafting concession agreement and supportagreements, as well as the bid documents.

28. Social and Environmental Specialist will review the social impact analysis and ensure that it

complies with the requirements of the Government, and is consistent with ADB's social safeguardpolicies. Assess adequacy, project capacity and commitment to implement the indigenous peoples,involuntary resettlement programs identified in the Outline Business Report. Ensure proposed mitigationmeasures and impact monitoring procedures are adequate, and that the necessary consultation anddisclosure frameworks are in place to ensure the proposed Indigenous Peoples and Resettlementprograms are implemented effectively. This Specialist will also review the environmental impact analysisand ensure that it complies with the requirements of the Government, and is consistent with ADB'senvironmental safeguard policies. Assess adequacy, project capacity and commitment to implement theprogram identified in the Outline Business Report. Ensure proposed mitigation measures and impact

monitoring procedures are adequate, and that the necessary consultation and disclosure frameworks arein place to ensure the proposed environmental management program is implemented effectively. TheSocial and Environmental Specialist will provide inputs into the output specification, the economic andfinancial model, contract specification.

29. Sub-Professionals several sub-professionals will be employed as junior staff to assist the keyprofessionals. These will include a water supply or civil engineer, a legal and a financial specialist. Inaddition an IT specialist will be required along with a cost estimator.

30. Estimated number of staff and durations are shown in Table 4: Illustrative Staff Inputs. The Biddershould present a management chart which identifies through bar charts the expected time that eachconsultant will spend on the Project.

Table 4: Illustrative Staff Inputs


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6 MANA GEMENT OF SERVICES

31. Bappenas shall be the Executing Agency (EA) for the Consultancy and will enter into a contract withthe Consultant. The Consultant will have been selected by the PMU (under BAPPENAS).

32. The BAPPENAS PMU-IRSDP will provide strategic direction and advice to the Consultants duringthe course of the Assignment. The Consultant will discuss technical issues with TAS-IRSDP includingenvironmental, social, and resettlement. TAS-IRSDP will provide trainers and training materials for

Capacity Building exercises. During Implementation the Consultant will report to the PemKab Maros,who is the end user of the Consultancy on technical matters. The PemKab Maros will monitor andsupervise the performance of the Consultant. All technical reports and communications will be submittedto the PemKab Maros, with copies to BAPPENAS and to TAS-IRSDP.

33. Within 15 working days of the signing of the contract, the Consultant shall submit an InceptionReport giving a detailed workplan and assignments for each individual in the team.

34. The Consultant shall submit concise interim reports each month describing progress of work,updated work schedule, and any key constraints encountered by the Consultant in the performance ofhis activities. The Monthly Reports are to be issued within three working days of the end of the month.Monthly Coordination Meetings will be held between the Consultant, GCA, PMU, TAS and otheragencies as appropriate within five working days of issue of the Monthly Reports. Meeting notes fromMonthly Meetings will be prepared by TAS and issued within three working days of the meeting. Thenotes will include an Action List stating specific tasks which are to be addressed during the month andresponsibilities for these tasks.

7 INPUTS TO BE PROVIDED BY GOVERNMENT

35. The following inputs will be provided by the Local Government:

Land Ownership: proof of land ownership of the proposed sites.

Data and Information: PDAM and related agencies will provide the Consultant withrelevant existing data and information including appropriate maps, plans, charts, satelliteimagery, previous surveys, and reports necessary to adequately perform the required

Services.

Counterpart Assistance: Province/Local Governments and the PDAM will assign full timestaff to work with the Consultant as counterparts. The counterparts will facilitate accessto parties and documents necessary for the execution of this Consultancy.

ID Task Name Duration Start Finish Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan

1st Quarter 2nd Quarter 3rd Quarter 4th Quarter 1st Q


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ID Task Name Duration Start Finish

1 STAGE 1: FINAL BUSINESS CASE 43 days 3 Jan '11 2 Mar '11

2 Deliverable 1: Project Preparation Report 10 days 3 Jan '11 14 Jan '11

3 Project Readiness Assessment 10 days 3 Jan '11 14 Jan '11

4 Institutional Capacity Assessment 5 days 10 Jan '11 14 Jan '11

5 Deliverable 2: Final Business Case 25 days 17 Jan '11 18 Feb '11

6 Project Rationale 1 day 17 Jan '11 17 Jan '11

7 Water Resource Confirmation 5 days 18 Jan '11 24 Jan '11

8 PDAM Business Plan 5 days 18 Jan '11 24 Jan '11

9 Market, Technical and Safeguard Due Diligence 10 days 18 Jan '11 31 Jan '11

10 Legal Due Diligence 5 days 18 Jan '11 24 Jan '11

11 Detailed Output Specification 3 days 1 Feb '11 3 Feb '11

12 Scenario Definition and Risk Allocation Matrix 3 days 4 Feb '11 8 Feb '1113 Financial and Economic Analysis 10 days 1 Feb '11 14 Feb '11

14 Investor and Financial Market Analysis 5 days 1 Feb '11 7 Feb '11

15 Government Support Analysis 5 days 1 Feb '11 7 Feb '11

16 Develop Tariff and Financing Structure 3 days 3 Feb '11 7 Feb '11

17 PDAM Performance Contract 3 days 8 Feb '11 10 Feb '11

18 Prepare Draft Term Sheet for Concession Agreement 3 days 11 Feb '11 15 Feb '11

19 Prepare Bid Implementation Plan 3 days 16 Feb '11 18 Feb '11

20 Deliverable 3: Presentation Final Business Case 8 days 21 Feb '11 2 Mar '11

21 STAGE 2: BID IMPLEMENTATION 216 days 3 Mar '11 29 Dec '11

22 Deliverable 1: Bid Documents 16 days 3 Mar '11 24 Mar '11

23 Prepare Draft Agreement and Supporting Documents 5 days 3 Mar '11 9 Mar '11

24 Prepare Draft Tender Guidelines 3 days 10 Mar '11 14 Mar '11

25 Prepare Draft Bid Documents 5 days 10 Mar '11 16 Mar '11

26 Establish On-Line Data Room 2 days 15 Mar '11 16 Mar '11

27 Detailed Bid Implementation Plan 3 days 17 Mar '11 21 Mar '1128 PPP Agreement Management Plan 3 days 22 Mar '11 24 Mar '11

Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan

Task

Critical Task

Progress

Milestone

Summary

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Rolled Up Critical Task

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Project: Maros Schedule 1010Date: 16 Nov '10

ID Task Name Duration Start Finish Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan

1st Quarter 2nd Quarter 3rd Quarter 4th Quarter 1st Q


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ID Task Name Duration Start Finish

29 Deliverable 2: Assistance with Bid Process 195 days 25 Mar '11 22 Dec '11

30 Alert Potential Bidders 5 days 25 Mar '11 31 Mar '11

31 Pre-Qualification 25 days 1 Apr '11 5 May '11

32 Finalize Project Structure & Bid Evaluation Procedures 5 days 6 May '11 12 May '11

33 Bidding for Project 65 days 13 May '11 11 Aug '11

34 Contract Negotiations and Award 30 days 12 Aug '11 22 Sep '11

35 Contract Post-Award Negotiations 20 days 23 Sep '11 20 Oct '11

36 PPP Agreement Signature and Financial Closure 65 days 23 Sep '11 22 Dec '11

37 Deliverable 3: Presentation of Final Report 5 days 23 Dec '11 29 Dec '11

Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan

Task

Critical Task

Progress

Milestone

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Project: Maros Schedule 1010Date: 16 Nov '10