Koeberg tender struggle cools off

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BR Koeberg 007[1] Bruce Sutherland An aerial view of Koeberg power station. A tender to replace steam generators was awarded to Areva. Photo: Bruce Sutherland

Westinghouse Electric South Africa had withdrawn an urgent application relating to a R4 billion tender to replace steam generators at the Koeberg nuclear power plant, it said yesterday.

This was done to focus on its court application for expedited review proceedings of Eskom’s rejection of its bid and acceptance of rival bidder Areva.

“Affidavits filed on behalf of Eskom in related court proceedings only serve to reinforce Westinghouse’s view that the decision not to award the tender to it was fundamentally flawed and should be reversed.”

Westinghouse said the affidavits showed Eskom intended to proceed to conclude or implement an agreement with Areva with undue haste, and with no proper regard to the risk that a court might ultimately overturn the power utility’s decision in review proceedings.

“Westinghouse has once again cautioned Eskom and Areva that they should not proceed with the implementation of the agreement, pending the conclusion of the review proceedings, and if they do proceed to implement, they do so at their own risk.”

It said the court application was directed at obtaining all relevant documentation relating to Eskom’s decision.

Westinghouse claims all levels of Eskom’s tender decision-makers had signed off on the award to Westinghouse only to be overruled by acting chief executive Collin Matjila and board tender committee chairwoman Neo Lesela, who unilaterally decided to recommend Areva’s bid to Public Enterprises Minister Lynne Brown.

“I am pleased that Westinghouse has seen the light on this matter,” Eskom’s acting group executive for technology and commercial Matshela Koko said. “With this matter behind us, Eskom is proceeding with the implementation of the Koeberg steam generator replacement project as planned.”

The power utility said it had received notice of the withdrawal of the application from Westinghouse’s attorneys.

Eskom said it was satisfied with the integrity of the process and it had ensured that the process remained fair and adhered to good governance.

The relief sought to access the documentation leading up to and forming the basis of the Eskom decision in the procurement of the steam generators will be heard today.

“Eskom has been working to provide such documentation in any event on the basis of a formal request via Westinghouse’s attorneys of record,” it said.

Last month, Eskom’s board of directors announced it had awarded the contract to Areva.

Westinghouse managing director Frederik Wolvaardt said four different sources had told Westinghouse officials that the company had won the bid before Brown made the announcement on August 16.

“Westinghouse handed in a better tender in all aspects – on a commercial and technical point – and at a lower price as well,” he was quoted as saying in Beeld newspaper.

The new generators are expected to be installed in 2018.

US-based Westinghouse has been active in South Africa’s nuclear industry, mainly through support to Koeberg, since the 1990s and is at the origin of nuclear fleet technology in the country.

Koeberg’s two reactors are Westinghouse-licensed.

The country intends to embark on a large scale nuclear power build estimated at R1 trillion.

Some see the programme as an even bigger successor to the arms deal that was allegedly riddled with irregularities and corruption.

Prospective frontrunners for the nuclear procurement are Russian state-owned Rosatom and Areva. Additional reporting by Sapa

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