The V&A Waterfront’s desalination plant service provider said it is planning to sue the city council for breach of contract to the tune of about R20 million.
Quality Filtration Systems (QFS) managing director Herman Smit said the company was contracted last January to provide one of three desalination plants with drinking water via a reverse osmosis sea-water desalination plant.
These plants were developed in the city council’s bid to beat Day Zero. “QFS won a tender with the City of Cape Town and funded the installation of the Waterfront desalination plant.” The original contract was valued at R53m, but only R1.7m has been paid so far by the city council. QFS served the city with a notice of breach of agreement and demand to remedy the situation on Friday. The city however disputes the current amounts being claimed.
“A number of disputes related to the payment of the contract remain unresolved and we had to appeal to the high court to ensure the city council met us for mediation to try and negotiate the payment of the contract. “We were in mediation for five days with five attorneys and one advocate and we reached no solution at the end of the period. Mediation was concluded on April 8, 2019. The city council has not validated any reason for non-payment.”
The city council is now blocking the publication of the mediation report, he said. According to QFS engineer and director Musa Ndlovu, more than 181 000 kilolitres of water, within the standard specification of SANS 241 part 1, has been injected into the City’s network by the QFS plant.
“The city (council) has sold this water at an augmented price, but has to date only paid QFS R1.7m,” Ndlovu said. “The city (council) is now claiming the water that it wilfully sold at a premium rate, was not to specification.”
“We understand that desalination is no longer considered a viable water augmentation solution. The city appears to view this as reason not to honour existing contracts.” Mayoral committee member for water and waste services Xanthea Limberg said the proceedings of the mediation are subject to a mutual confidentiality undertaking that the city council has upheld.
“There are a number of disputes relating to the amounts invoiced by QFS. The city (council) is willing to pay the amounts certified by the city’s engineer, and disputes the current invoice amounts being claimed. “Please be advised there is no mediation report as claimed by QFS.” Limberg said.