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One pre-nuclear tender makes up 80% of total cost of DoE spend

Cape Town – The R171m tender the Department of Energy (DoE) awarded to the son of President Jacob Zuma’s friend makes up 80% of the department’s tender costs for nuclear-related contracts, it revealed on Tuesday.

Addressing Parliament’s Portfolio Committee on Energy, Zizamele Mbambo, deputy director general and head of nuclear energy, tabled 16 service contracts the DoE entered into from 2013 to 2016 in the run-up to the nuclear new build programme.

Of the 16 contracts, which totalled R212.87m, the tender by Central Lake Trading (or Empire Technology) was the biggest at R171m.

READ: Red flags raised over pre-nuclear tenders worth R173m

The company is owned by Shantan Reddy, the son of Zuma’s friend Vivian Reddy.

“The intended outcome of this service is to provide the department with the ability to effectively and efficiently administer programme management,” said Mbambo.

“(This includes) procurement, project tracking, governance, compliance and information management for the nuclear new build programme (NNBD).

“The system will also provide the department with a secured environment for the NNBD information management,” he said.

The date of completion is set for December 9 2017, he said.

The other big tender was Mahlako A Phahla’s R20.17m contract for a pre-procurement readiness assessment. This was almost 10% of the total spend on service contracts.

KPMG, Deloitte, Ingerop, Nathan Gift Nhlapo, The African Radiation Consultations, Zimkile Consulting, the University of Pretoria and Mzansi Energy Solutions were other companies who were awarded tenders in the run-up to the new build programme.

The nuclear new build programme has hit a possible delay after the DoE tabled the draft Integrated Resource Plan (IRP) last week, which recommended delaying the first reactor going live in 2037. The current plan is to have about eight new reactors (9.6 GW) going live by 2030.

Eskom, which was recently made the owner, procurer and builder of the 9.6 GW nuclear procurement programme, was adamant the original plan should go ahead and has vowed to release the request for proposals by the end of 2016.

Below is the full list of service providers from 2013-2016: 

YearCompanyStudyCost
2012KPMGStudy on comparative analysis of shale gas to power versus nuclear power in South AfricaR 341 002
2013KPMGBenchmark of Procurement FrameworkR 907 708
2013IngeropCost of nuclear powerR 1 005 460
2013IngeropOwner operators and financing structureR 3 601 933
2013Nathan Gift NhlapoFeasibility study on effective independence of the NNRR 496 960
2014DeloitteFinance options models solutionsR 4 250 000
2015DeloitteDeferred return on government investor approachR 995 334
2015IngeropEconomic impact of localisation of nuclear new build programmeR 6 137 820
2015Nathan Gift NhlapoAcceession to one of the IAEA liability conventionsR 496 960
2015The African Radiation ConsultationsDevelopment of Training Programme of 1st respondersR 700 416
2016Zimkile ConsultingDevelopment of training material of 1st responders for nuclear & radiological emergenciesR 469 114
2016Nathan Gift NhlapoMechanism to enforce implementation of corrective actions by municipalities on nuclear emergencyR 469 752
2016University of PretoriaA detailed financing model for the radioactive waste management fund billR 1 324 680
2016Mzansi Energy SolutionsFeasibility on the withdrawal of safeguards function from NecsaR 499 780
2016Mahlako A PhahlaPre-procurement readiness assessmentR 20 174 424
2016Central Lake Trading TA / Empire TechnologyProgramme management systemR 171 000 000
TotalR 212 871 343

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