Westinghouse challenges Eskom nuclear contract

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Johannesburg - Westinghouse Electric Company said on Thursday it had filed a legal challenge in a South African court to reopen the bidding process for a generator contract awarded to French rival Areva.

But South Africa's power utility Eskom said the matter was a done deal and Areva had won the contract to provide six steam generators for the country's only nuclear power plant at Koeburg near Cape Town.

The refit is part of a programme to install up to 9,600 megawatts of new nuclear power by 2030 to help Africa's most advanced economy ease chronic electricity shortages.

Westinghouse, the world's largest nuclear fuel producer and part of Japan's Toshiba group, said in a statement it had gone to the Johannesburg High Court about the matter.

“It will be clear that a continuation of the current process is necessary and a reversal of the announced initial preferred candidate decision is appropriate,” a Westinghouse spokesman said.

Eskom said it would provide Westinghouse with the documents it was requesting through the courts.

“Eskom's internal approval processes for the replacement of the Koeberg steam generators have been completed,” the utility said in a statement.

The US Embassy said it had been in touch with the South African government to discuss Westinghouse's concerns.

“We will continue to closely monitor this case, we expect fair treatment of our companies under South African law,” the embassy said in a statement.

“We believe such actions can send an important signal about the quality of the investment climate in a country.”

Projects of this nature can be worth hundreds of millions of dollars but Eskom did not put a figure on the contract.

The vast majority of South Africa's electricity is generated from coal and the government is struggling to ensure that supply stays a step ahead of growing demand.

The generators are expected to be installed by 2018. - Reuters



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