In its latest decision, the Public Auditor denies SK Shipping's appeal. This is a decision on the appeal of the denial of a protest by the Executive Director of the Commonwealth Utilities Corporation regarding CUC-RFP-03-015.

CUC issued CUC-RFP-03-015 (“RFP”) on March 7, 2003. According to the RFP, CUC requested “proposals from qualified firms for the supply of fuel for its power plants of Saipan, Tinian, and Rota.” Prior to bid closing, CUC received two requests to extend the RFP, both of which were denied. On March 28, 2003, CUC received two proposals, one from SK Shipping (“SK”) and one from Mobil Corporation (“Mobil”). SK’s proposal included a Letter of Representation, dated March 24, 2003, appointing Pacific Petroleum Corporation (“PP”) as its Sales Representative for the solicitation for the sale of petroleum products to CUC in the CNMI. SK’s proposal also included a statement that it designated PP as its Sales Representative in the CNMI.

CUC designated a Source Selection Committee (“Committee”) to evaluate the proposals received. On April 23, 2003, the Committee submitted its findings and recommendations regarding the RFP (“Committee’s Findings”) to the Director. The Committee’s Findings found that SK’s proposal was non-responsive to the RFP and was, therefore, not susceptible to evaluation for two reasons:

1. Delivery of fuel to Rota, Tinian Power Plant III and IV was not addressed or priced in the proposal. SK specifically states that additional costs would be incurred for delivery to Rota.
2. CUC stated in the scope of work that the payment terms “shall be” sixty days from the invoice date. The payment terms SK proposes requires CUC to obtain a Letter of Credit (LOC), due and payable sixty days after the bill of lading and invoices are issued.

By letter dated April 24, 20031, CUC notified PP that the Committee had reviewed SK’s proposal and found that it was non-responsive to the RFP and was not susceptible to evaluation. In that letter, CUC stated that “SK did not provide for and price delivery to Tinian and Rota and did not accept CUC’s terms as to payment.”

The Committee recommended award of the contract to Mobil, the only other proposer, “as Mobil’s proposal met the requirements of the scope of work and Mobil was determined to be a responsible bidder.” Decision at 2. Subsequently, a contract was awarded to Mobil under the RFP.

On May 21, 2003, PP filed a protest concerning the award of the contract under the RFP. The protest was supplemented by an addendum dated May 28, 2003. The Director denied the protest.

On July 10, 2003, PP delivered, what it referred to as, a stack of “100 or so pages of documents” to OPA with a cover letter that was dated July 9, 2003. The letter asked that OPA consider the letter a formal request “to investigate the CUC decision to sign a two
year contract with Mobil ...”.

View/download copy of the decision