BOREHOLE DRILLING AGREEMENT

This borehole drilling agreement is made and made into effective this …….day of …..…….2021

BETWEEN

                            STECOL CORPORATION

                                                  (owner)

                              P.O. Box 46532-00100 Nairobi

……………………………………………………………………………………………………………………………………….

AND

WATERLINK LIMITED

(Drilling Contractor)

P.O Box 45237-00100, Nairobi

FOR

The borehole drilling and construction of two wells to an estimate depths of 150 meters, Supply and installation of the borehole pumping equipment along Chepareria, West pokot and for which premises the owners has the authority to undertake the improvements contemplated by this agreement.

It is hereby agreed:

  1. SCOPE OF WORK
    1. The work comprises of Hydro geological and environmental impact assessment,  drilling of one (2) borehole to average depths of 150m, Supply and installation of the borehole pumping equipment,together with ancillary work as specified in quotation  of 16th  January 2021(“Quotation”) which forms part of this agreement.
  • CONTRACTOR’S OBLIGATIONS
  •  
    • Work: The contractor agrees to finish all labour, services, material, equipment, and all other as is necessary for the timely and proper completion of the water well in accordance with his quotation attached hereto and made a part of this agreement and in accordance with the terms of this agreement.
    • Control: The drilling contractor will supervise and direct the work, using his best skills and attention, and shall be solely responsible for and have control over construction means, methods, techniques, sequences, and procedures and for coordinating all portions of the work under this agreement. Construction of the water well and tank shall conform to the quotation, with such changes only as may be agreed to by the parties in writing. Neither party will unreasonably withhold its agreement.
    • Debris, restoration: During construction, drilling contractors shall keep the work site and surrounding area free from any unreasonable accumulation of debris and waste materials. Unless expressly agreed to in writing in the job proposal, upon completion on the work the drilling contractor shall be responsible to remove all debris, waste and surplus materials or rubbish remaining on the work site, and to restore the site to its required condition.
    • Responsibility for employees: Drilling contractor shall be responsible to owner for the acts and omissions of the drilling contractor’s employees, subcontractors and their agents and employees, and other persons performing portions of the work under the contract of the drilling contractor.
    • Safety: Drilling contractor shall be responsible for initiating, maintaining and supervising all safety precautions and programs in connection with the performance of the work and shall comply with all the applicable laws, ordinances, rules, regulations, and orders. Drilling contractor shall take all reasonable precautions for safety of, and shall provide protection to prevent damage, injury, or loss to
      • person who may be directly injured during the work,
      • the water well and materials and equipment to be incorporated therein, and
      • any other property and improvements at the site or adjacent thereto.
  • OWNER’S OBLIGATION
    • Authorization: Before the contractor moves to site, the owner shall obtain all authorization required for the execution of the drilling works. The contractor shall not be responsible for work stoppage resulting from enforcement of any such non-compliance by any legal authority.
    • Identification of borehole construction site: the owner will correctly confirm the site at which the borehole should be drilled. The contractor shall not be responsible for incorrect positioning of the well and shall be paid for all work that may be carried out at a wrong site.
    • Payment: the owner undertakes to pay the contractor for work done according to the schedule set out in this agreement.
  • CONTRACT PRICE ( FOR ONE BOREHOLE)
    • Contract value: The contract is valued at Kshs. 1,763,896 ( One million seven hundred sixty three thousand eight hundred ninety six)
  • PAYMENT SCHEDULE
    • Preliminary Works: The owner agrees to pay to the contractor, Kshs 130,000 ( One hundred thirty thousand) being the full amount of the hydrogeological and environmental impact assessment, upon presentation of the report
  • Down payment: Owner agrees to repay 50% of the contract sum of one borehole less 5.1 above,  Kshs 816,948 ( Eight hundred sixteen thousand, nine hundred forty eight  ) to the drilling contractor upon Drilling Rig arrival on site
  • 1st  intermediate  payment: Owner agrees to pay 30% of the contract sum for one borehole less 5.1 above, Kshs 490,168.8 (Four hundred ninety thousand, one hundred sixty eight, eighty cent only) upon completion to drilling  and pump testing of each borehole
  • Final payment: The owner agrees to pay 20% of the contract Sum Kshs 326,779.2 (three hundrd twenty six thousand. Seven hundred seventy nine, thenty cent only)  or any other amount arrived at as per the actual work done  to  drilling contractor upon installation and commissioning of the Pumping equipment of each borehole.
  • Banking details: Payment by cheque or direct funds transfer to the drilling contractor’s account as belowj detailed.

ACCOUNT NAME: WATERLINK LIMITED

ACC/NO:                  3011819248002

BANK:                      KINGDOM BANK

BRANCH:                THIKA

SWIFT CODE:         CIFIKENA

BANK CODE:          051

  • OWNER’S CHANGES:
    • Owner, without invalidating this agreement, may order changes in the work. Such changes shall be authorized by written modification of this agreement. An appropriate adjustment to the price will be made with the consent of both Owner and Drilling Contractor in writing, which consent shall not be unreasonably withheld. Owner acknowledges and that water well Drilling Contractor’s ability to complete the work in a timely manner will be directly affected by any change order requested by owner.
  • WORK SCHEDULE:
    • Drilling shall begin within Seven (7) days upon Signing this agreement.
  • Construction of each borehole shall be completed within Fourteen (14) days after commencement of work. Delay of work will arise of punishment of 10% of Contract price in Maximum within seven days of completion date. The Owner will reserve the right to terminate the Contract after two months by signing this agreement, if the Contractor fails to complete the whole borehole work.
    • “Completion” shall mean that the water well has been installed with  the permanent pumping system, pumping equipment.
  • CORRECTIONS.
    • Corrections : Owner  shall provide Water Well Drilling Contractor with a reasonable  opportunity to cure any claimed non- conformity and agrees not to remove Drilling Contractor from premises or order Drilling Contractor  to stop work so long as Drilling Contractor diligently undertakes to cure the claimed non- conformity.
  • MEDIATION, ARBITRATION:
    • All claims or disputes between Owner and Drilling Contractor arising out of or relating to this Agreement shall be submitted to non-binding mediation pursuant to the Construction Industry Mediation Rules of the Kenyan Arbitration Association. Owner and Water Well Drilling Contractor shall mutually select and equally share in the cost of the services of a mediator. The chosen mediator must have reasonable knowledge of the water well drilling industry. In the event that the dispute is not resolved following mediation, the matter shall be resolved by binding arbitration pursuant to the Kenyan Arbitration Act 1995, [as amended from time to time].
  1. WARRANTIES.
    1. Workmanship, Materials: Drilling Contractor warrants that all Work performed hereunder will be performed in accordance with this Agreement and in a proper workman like manner, free from all defects.
  1. ENTIRE AGREEMENT: This Agreement contains the entire understanding of the parties hereto and all prior agreements, which fully and completely constitutes the entire agreement between the parties regarding the construction of the water well.
  1. SEVERABILITY: Each provision of this agreement shall be interpreted in such manner as to be effective and valid under law. If any term, condition, covenant, agreement or such provision shall be ineffective to the extent of such prohibition or invalidity without invalidating, impairing or otherwise effecting any other provision of this agreement, which shall remain in full force and effect.
  1. GOVERNING LAW: The construction, validity and performance of this agreement shall be governed by and construed in accordance with the laws of Kenya.

Signed and agreed to be effective the day and year first above stated.

  Owner’s Representative Owner’s Witness
Signature    
Name    
Contacts    
Date    
  Contractor’s Representative Contractor’s witness
Signature    
Name    
Contacts    
Date