CO885-(7-8) — Page 114

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259

PUBLIC RECORD OFFICE

Reference :-

C.O.885

No. 23.

MESSES. CLARK, FÖRDE, & TAYLOR to the PACIFIC CABLE COMMITTEE.

SIR,

PACIFIC CABLE TENDERS,

4. Great Winchester Street, London. E.C., August 17, 1900.

WE now place before you our Report on the four tenders which have been received for the Pacific cable.

Copies of the tenders and of the letters covering them are included in Appendix I. The Telegraph Construction and Maintenance Company and Messrs. Siemens Bros. & Co. are the only manufacturers who tender for the whole project.

1

The India Rubber, Gutter Percha and Telegraph Works Company (Silvertown Co.) are willing to accept Contract No. 1* or Contracts No. 2* and No. 3,* separately or combined, i.e., they will not accept the whole work.

Messrs. W. T. Henley's Telegraph Works Company tender for Contract No. 3 only, and their offer is made subject to the market price of gutta percha. Their tender is, therefore, we presume, unacceptable.

The times during which the tenders will remain open are as follows :—

Henley's until the 31st August, 1900.

Silvertown until the 31st March, 1901.

Telegraph Construction Company until the 14th September, 1900, Siemens Bros. until the 14th October, 1900,

With regard to the cost, the following table shows the prices quoted by each manufacturer :--

The net result is that at the present time the markets, both here and at Singapore, are bare of gutta percha, and that what has been called a

gutta, percha famine prevails.

With regard to the times and dates for completion, all the tenders, except Henley's, are more or less conditional; that is to say :-

Henley's Company offer to complete Contract No. 3 in 11 months from order. The Silvertown Company would use their "best endeavours" to complete any part of the work which they are willing to undertake, viz., Contract No. 1, or, alternately, Contracts No. 2 and No. 3, or either of them, in 18 months from date of order,

The Telegraph Construction Company offer to complete the laying of the cables of any one contract by 31st July, 1902, and if more than one of the contracts is assigned to them, then the time of completion would be a 16 matter of arrangement.”

Siemens Bros. and Co. would require 12 months to complete Contract No. 1, 10 months for Contract No. 2, and 10 months for Contract No. 3, but they state that the time of completion of more contracts than one would be “considerably less than the sum of the times needed" for each contract.

Remarks on Tenders.

Without knowing exactly the relative importance attached by the Committee to the questions of time and of cost, the nature of the tenders makes it difficult to advise in this matter, but assuming that the 31st July, 1902, is the most distant date that can be considered, we should suggest that Contract No. 1 (for the long section) should be placed with the Telegraph Construction Company, as their tender is by far the lowest ; and that the other Contracts, No. 2 and No. 3, should be given to the Silvertown Company, provided they are willing to accept the said contracts as they stand, and to undertake the completion of all sections by the 31st July, 1902,-in other words, that a certain extension of time should be granted them on condition that their reservation as to use of best ondearours is withdrawn. (See copy of their tender, Appendix I.)

The price for the cables only would:then stand thus :-

7

ALLY WITHOUT PERMISSION OF THE BE REPRODUCED PHOTOGRAPHIC- COPYRIGHT PHOTOGRAPH—NOT TO

PUBLIC RECORD OFFICE, LONDON

W. T. Henley's Telegraph

Works Company.

LR., G.P. and Telegraph Works Co. (Silvertown).

Telegraph Con- struction anci Maintenance Company.

Siemen Bros.

& Co.

Clark, Forde,

& Taylor' Estimate

£

*

Contract No. 1 Contract No. 2 Contract No. 3

375,000

Totals

1,153,000 415,000 404,0*0

1,972,000

1,067,602 1,235,000

388.358 339,040

512,200 161,500

1,795,000 | 2,208,700

1,467,659

In the line of totals we have added together the amounts for the different contracts, for the sake of comparison, with the estimate furnishel in Mr. H. A. Taylor's letter of the 13th March, viz. :-£1,445,659 increased by the £22,000 mentioned in the note to Appendix II. of his Report, dated 6th April lasts

It will be seen that the lowest tender, that of the Telegraph Construction Company, for the whole work is £1,795,000, or £327,341 in excess of our estimate, whilst the difference between the highest and lowest tender is no less than £413,700.

Prices for steel and iron wire are no higher now than they were last April, and practically the whole increase is due to the advance in the price of gutta percha.f Unfortunately, the project appears to have had a twofold action in increasing the price of this material; on the one hand, the action has been direct and due to the magnitude of the project itself; and on the other, indirect and consequent on the stimulus given by it to the placing of orders for other cables to Australia r the Cape of Good Hope.

Contract No. 1, Vancouver to Fanning Island.

Contract No. 2, Fanning Island to Fiji.

Contract No. 3,

Fiji to Norfolk Island.

Norfolk Island to Queensland. Norfolk Island to New Zealand.

† See also Mesars, Henley's letter, Appendix I.

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2

Contract No. 1

Contract No. 2

1,067,602

415,000?

Contract No. 3

404,000 $

(Telegraph Construction Company.) (Silvertown Company.)

Total

£1,886,602

(£418,943 above estimate.)

If a further extension of time beyond July, 1902, could be allowed, a saving of some £26,500 would be effected by giving Contract No. 1 and Contract No. 2 to the Telegraph Construction Company, and Contract No. 3 to the Silvertown Company.

Taking, however, the total sun mentioned, and adding thereto the cost of items unprovided for in the contracts, as estimated in Appendix II. to Mr. Taylor's report of 6th April last, and also the approximate cost of the soundings, the expenditure on the whole project would stand as under :-

Cables

Amount in Appendix II. Survey

£1,886,602 180,000 24,000

£2,090,602

It should be pointed out, however, that the Telegraph Construction Company also make certain reservations in the covering letter to their tender; a copy of the letter, with our marginal remarks thereon, is included in Appendix I.

It will be apparent from the foregoing remarks that the placing of the contracts still remains to some extent a matter for negotiation. It also seems to us possible that negotiations might lead to some reduction in the prices quoted.

To avoid confusion in this report on the tenders for cable, we have dealt separately with the tenders for survey and soundings. (Contract No 4.)