Risks Related to Quality

Monthly Progress Report January 2017 Western I ndonesia National Roads I mprovement Project 7 - 1 7 ISSUES and RECOMMENDATIONS

7.1 Current Situation

The main issues during this month of January 2017 are as follows: a Five 5 packages 11, 12, 13, 15, 17 are much lagged behind schedule in this month. b Delayed issuance of Notice to proceed will affect the twenty one 21 months time of completion of Contract Package 16. The completion date will keep on stretching further beyond the expiry date of the loan agreement on December 31, 2017. c LARAP implementation for Packages 05, 12, 13, 14, 15, and 17 cannot be completed in FY 2016 and splitzing program for land acquisition in the provinces of Lampung, Bengkulu, and North Sumatra is still not budgeted d Amendment to the extension of the implementation time and increase the contract value for Package 05 should follow the direction of WB in accordance with the letter ref.WINRIP 364 dated November 23, 2016 e The contract agreement for Package 03 Manggopoh-Padang sawah has not been amended related to the calculation of the final quantity of the works. f Land acquisition of Package 15 Sibolga-Batas Tapsel obstacles along the 4 km for the people in the village of Pinang Baru - Pinangsori sub district not willing acquisited g Changes in the design of pavement widening from flexible to rigid pavement in Package 15 is not supported by the consent of the DGH. h Commencement of work of the Technical Assistance for Development of Slope Stabilization, Design Management estimated April 2017 with a 11 month time for services going beyond the loan closing date i If the cancellation of packages 10 Sp. Empat Air Balam is realized, the loan restruction has to be prepared. j There is a road damage due to water scouring on the side ditch Package 03 Manggopoh-Padang Sawah k Roads damaged by settlement land slide in the Sta 6+300 and Sta 6+400 Package 01 Krui-Biha have not been repaired l Production of crushed stone tends to form a flaky and elongated beyond the requirements of 10 allowed in the specification.

7.2 Actions Required

a Actions and measures to be taken  Package No.11 : Time Extension in process the Contractor s proposal 108 days.  Package No.12 : Test Case for 2 weeks 6. Feb 19. Feb 2017 Depending upon the results of the test case, the next actions will be followed.  Package No.13 : In recovery stage  Package No.15 : In recovery stage  Package No.17 : In recovery stage b Currently, the contractor is doing staking out and field engineering to determine the condition of the existing road. Once the field engineering is completed, the contractor will submit alternative proposals for completion of the project. Monthly Progress Report January 2017 Western I ndonesia National Roads I mprovement Project 7 - 2 c The budget for land acquisition of Packages 05, 12, 13, 14, 15, and 17 have been allocated in fiscal year 2017. The PIU is requested to remind the PPK to allocate the fund for splitzing programs especially for provinces of Lampung, Bengkulu, and North Sumatra. d The PPK is under preparation of amendment which is included with an additional contract value and Time Extention. e In accordance with the results of TFAC inspection on site, WB had agreed principally in verbal and the PPK requested the Pre-Audit of BPKP for the legal aspects in term of making amendment after TOC. f Contract Amendment and technical justification of Package 03 related to the final quantity is being reviewed by the PIU and PMU. CTC and PMU will consult to the WB s Procurement Specialist related to the legal aspects of the contract in terms of making amendment after the TOC. g If the issue of land acquisition in Package 15 cannot be resolved, roadwork in that segment of the road will use the existing ROW. h Any changes to the contract must follow the instructions set forth in the Project Management Manual of WINRIP i Proposed extension of the loan closing date j The repairing work done by gabion was completed. k Information on related Satker that the repair work being carried out by the disaster fund. l It has been discussed with the Bank in terms of the possibility of financing such works within the defect notification period. WB requires data on the implementation of the road construction and design for handling the road settlement. m CTC has written to DSC to evaluate the entire stone crusher in WINRIP and find out causes and remedies.