Nuclear deal ‘not done’

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IOL BR Koeberg 101[1]

City of Cape Town.

Mixed signals are emerging over plans to extend SAs nuclear capacity beyond Koeberg. Photo: Bruce Sutherland, City of Cape Town.

The government has dismissed speculation that Rosatom already had a head start to build eight power stations in South Africa, but links with the Russian state-owned nuclear energy firm appear to be strengthening by the day.

The chief energy investment strategist at Casey Research, Marin Katusa, reported on Tuesday that in the global battle for energy supremacy, Russia “has won another victory over the US”.

He claimed Rosatom had just signed an agreement to build eight new atomic reactors in South Africa, which he described as “the battleground”.

In addition, he claimed that Russia would help develop “the entirety of South Africa’s nuclear energy sector including financing and training. Just as importantly, South Africa will be using Russia’s nuclear fuel.”

Katusa said Rosatom aimed to become the largest supplier of uranium, a key nuclear fuel, in the coming years.

While Department of Energy director-general Nelisiwe Magubane quipped that if such a deal had been signed “I would have known about it”, Kelvin Kemm, the managing director of Nuclear Africa, said that Russia had already signed a collaboration agreement with the SA Nuclear Energy Corporation (Necsa).

Kemm chaired a nuclear investment conference in South Africa late last year with about 50 Russian nuclear energy experts.

Pressed on whether relations between Moscow and Pretoria in the field of nuclear development were growing warmer, he said: “I don’t know whether I would call it warming up or cooling down… but they have always been good.”

While he dismissed speculation about Russian involvement in the building of eight power stations, Kemm said Rosatom was mandated to draw up a nuclear roadmap as part of its agreement with Necsa.

It was expected that details of this plan would be made public in coming weeks.

Kemm noted that Magubane had previously stated that South Africa’s nuclear programme would have to target a 50 percent “localisation” of content.

This meant that all the nuts and bolts of the proposed nuclear plants, including pumps, valves and steam electronic controls, needed significant South African inputs.

President Jacob Zuma, Energy Minister Ben Martins and other top government officials were expected to attend a major nuclear summit in Midrand in March, Kemm reported.

Dawid Serfontein, a senior lecturer at the North West University’s School of Mechanical and Nuclear Engineering, has produced a paper arguing that nuclear power plants are cheaper than coal-fired power stations if the funding model is correct and South Africa can garner “cheap loans”.

He took issue with Anton Eberhard, a member of the National Planning Commission, who has questioned the wisdom of the government’s intention to construct new nuclear power stations – in addition to the existing Koeberg – because the construction cost would be prohibitively high.

Significantly, Serfontein said nuclear vendor countries “such as Russia” had promised to supply cheap loans to boost their nuclear sales.

DA energy spokesman Lance Greyling said he was concerned with reports emanating from a variety of sources that a deal had already been struck with Russia to build eight reactors.

In October last year the Voice of Russia had announced that such a deal had been struck.

This had now been repeated by Casey Research.

He noted that the Energy Department said last year that an agreement had been drafted but had not been finalised.

“The detail of that agreement was a cause for concern at the time as it gave veto powers to Russia over the involvement of any other parties in South Africa’s nuclear programme,” Greyling said.

“This would clearly be in contravention of the tender procurement processes.”

He said it was “also suspicious” that this deal was drafted around the same time as the ANC signed a co-operation pact with President Vladimir Putin’s United Russia party and the ANC’s fund-raising initiative, the Progressive Business Forum, undertook a trip to Russia in November last year.

According to Engineering News, the delegation included Martins, Necsa chief executive Phumzile Tshelane and former trade and industry minister Mandisi Mpahlwa, who is now ambassador to Russia.

They visited the Mashinostroitelny Zavod facility of Rosatom nuclear fuel subsidiary company TVEL, where they were shown the main production workshops and briefed on the latest procedures in the fabrication of nuclear fuel.

Greyling said: “The DA calls on the government to come clean on the status of this agreement and to make the details public so that we can ascertain whether it is in fact constitutional in terms of the procurement procedures.

“The impression has been given to Russia, it seems, that the nuclear procurement process will proceed and that they will be given the tender.”

It was particularly concerning in the light of the fact that the recent update of the Energy Department’s 20-year plan “explicitly states this procurement process needs to be delayed and that various other energy options should be considered”.

Greyling said the ANC government should not be allowed to commit the country to a nuclear deal that did not make economic sense and would lead to far higher electricity prices, noting that the cost of the eight proposed power plants could be R1 trillion or more.


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