No evidence of corruption was provided - IPP office on challenge to R218bn Karpowership deal

accreditation
0:00
play article
Subscribers can listen to this article
Karpowership operates a floating power plant KARPOWERSHIP
Karpowership operates a floating power plant KARPOWERSHIP
  • The head of SA's Independent Power Producer Procurement (IPP) Programme Office said a rival's challenge to the awarding of a R218bn contract to Karpowership was 'without merit'
  • DNG had demanded that it be appointed to provide about 1 220 megawatts of electricity in place of Karpowership, alleging that the process had been tainted by corruption
  • The head of the IPP office says DNG’s bids were disqualified because they were inadequate


Authorities have said a legal challenge by DNG Energy to the awarding of a power supply contract worth an estimated R218 billion to Turkey's Karpowership was "without merit" and "self serving". 

In his answering affidavit to DNG’s demand to be named as a preferred bidder in an emergency power round, the head of the country’s Independent Power Producer Procurement (IPP) Programme Office said DNG’s bids were disqualified because they were inadequate.

DNG had demanded that it be appointed to provide about 1 220 megawatts of electricity by August 2022 in place of Karpowership, alleging that the process had been tainted by corruption. The IPP office refuted this. The case will be heard July 14-16 in South Africa’s High Court.

"The applicant has failed to show any illegality in the tender process," Tshifhiwa Bernard Magoro, the head of the IPP Office said in an affidavit. "The applicant’s bid did not meet the qualifying criteria."

The case could derail the government’s attempts to ease electricity shortages that have hobbled the economy for more than a decade as most winning bids need to meet financial close by the end of July. The procurement of emergency power was instigated to partially ease a crisis caused by the inability of state power utility, Eskom Holdings SOC Ltd., to meet the country’s needs.

Karpowership’s bid has attracted criticism because it won an exemption from a local-content requirement and because it locks the country into using natural gas, a fossil fuel, for two decades. DNG’s bids were also based on gas-fired plants.

Magoro’s affidavit also responded on behalf of Mineral Resources and Energy Minister Gwede Mantashe.

“The applicants bids were disqualified because they did not comply with a plethora of qualification criteria,” he said. Magoro listed DNG’s alleged inability to prove it owned land where it planned to build plants, secure financial backing, comply with environmental requirements and prove that it could supply interrupted power.

"DNG issued its application without us having sight of the record and to this date we haven’t had sight of the full record," the company said in a response to queries.

"It is therefore irresponsible for any party to comment or make sweeping statements on whether we qualified or not when we haven’t been given the record and time to scrutinize the full record."

Magoro also said DNG failed to provide evidence of corruption.

"The inescapable inference is that the applicant’s allegations are self-serving and its claim to be acting in the public interest is baseless," he said.

We live in a world where facts and fiction get blurred
In times of uncertainty you need journalism you can trust. For 14 free days, you can have access to a world of in-depth analyses, investigative journalism, top opinions and a range of features. Journalism strengthens democracy. Invest in the future today. Thereafter you will be billed R75 per month. You can cancel anytime and if you cancel within 14 days you won't be billed. 
Subscribe to News24
Rand - Dollar
16.17
+0.5%
Rand - Pound
19.63
+0.9%
Rand - Euro
16.60
+1.0%
Rand - Aus dollar
11.52
+0.1%
Rand - Yen
0.12
+0.8%
Gold
1,801.16
+0.7%
Silver
20.77
+2.3%
Palladium
2,234.50
-2.4%
Platinum
964.50
+0.4%
Brent Crude
99.60
+2.2%
Top 40
63,996
-1.0%
All Share
70,731
-0.8%
Resource 10
64,048
-2.8%
Industrial 25
86,577
-0.6%
Financial 15
16,059
+0.6%
All JSE data delayed by at least 15 minutes Iress logo
Company Snapshot
Government tenders

Find public sector tender opportunities in South Africa here.

Government tenders
This portal provides access to information on all tenders made by all public sector organisations in all spheres of government.
Browse tenders