By October 30, 2017 Read More →

Puerto Rico power contract under investigation by FBI- WSJ

Puerto Rico power contract

The Puerto Rico power contract awarded to Whitefish Energy Holdings has been cancelled and is now under investigation by the FBI. Reuters photo by Alvin Baez.

$300 million Puerto Rico power contract awarded to small Montana company

On Monday, the Wall Street Journal reported that the FBI is investigating the $300 million Puerto Rico power contract awarded to a small US energy startup company.

At the time the company was awarded the contract, Whitefish Energy Holdings had only two full-time employees.

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According to NPR, the company was awarded the contract by the Puerto Rico Electric Power Authority, or PREPA, because it did not demand a down payment and it agreed to agreed to look after the logistics of feeding and housing its contract workers.

Last week, the controversy over the the contract between the company and PREPA hit a feverish pitch after terms of the contract, won without a competitive bidding process, were revealed.

Most of the controversy focused on the high rates Whitefish charged PREPA for labour.  A general foreman was costing the authority $240/hour while a lineman was charged out at $227/hour.  Per diems of $80/day for meals and $332 for lodging also raised eyebrows  and employee flights were billed at $1,000 each way. Higher still were rates for subcontractors, or the bulk of Whitefish’s workforce.  A general foreman cost $336/hour and a lineman, $319/hour.

On Sunday, PREPA cancelled the contract, just hours after the Governor of Puerto Rico, Ricardo Rosselló, demanded it be scrapped.

According to the Wall Street Journal, FEMA, a number of congressional committees and local auditors have begun requesting documents concerning the deal.

A spokesman for the company says it is not aware of the investigation, but Whitefish says it “is committed to full cooperation with any inquiry or investigation”.

The WSJ says the FBI office in Puerto Rico did not respond to a request for comment.

 

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