The company says that all the agreements under the IPPO are based on a similar consensus. Photo: Karpowership
Multinational company Karpowership wants former Eskom CEO Andre de Ruyter to retract comments he made on news television station eNCA implicating the company in alleged corrupt activities leading to the downfall of the power utility.
The Turkish builder, operator and owner of a fleet of power ships has denied the outgoing Eskom CEO’s allegations made during his interview with Annika Larsen.
In a statement released on Tuesday, the shipbuilder said that the interview made it look like “there was something untoward about the emergency decision taken during Covid-19 to procure enough electricity to enable people on ventilators to be able to breathe”.
This resulted in projects being awarded to Karpowership.
“Karpowership unequivocally and unconditionally denies any allegations of impropriety on its part and rejects and dismisses insinuations of corruption,” the company said.
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“Unfounded allegations of corruption related to the Karpowership projects have been often repeated, relying on speculation and innuendo (not objective facts), and cannot be allowed to continue unchecked and unabated.”
The facts, according to Karpowership
The company said it responded to a request for a proposal from the department of mineral resources and energy administered by the Independent Power Producer Office (IPPO) under the Risk Mitigation Independent Power Producer Procurement Programme (RMIPPPP).
“Karpowership submitted bids on December 22 2020 for three projects located in Coega, Richard’s Bay and Saldanha, aiming to deliver a total of 1 220MW to counter more than an entire stage of load shedding,” the company explained, countering comments around the length of the contracts and the fact that the ship could always sail away.
The statements further alluded to De Ruyter misrepresenting the facts when he said that there was no reason for Eskom to enter into a 20-year year agreement with a company that could raise the anchor and sail away with an asset paid for by South Africa.
The company said:
The RMIPPPP followed a substantially similar tender and adjudication process as South Africa’s lauded REIPPPP [ Renewable Energy Independent Power Producer Procurement Programme].
“This included the requirement for a non-negotiable 20-year term power purchase agreement with Eskom.”
The company said that all the agreements under the IPPO were based on a similar consensus.
On ownership, the company said, “as with all IPPO procured power projects, the government does not acquire or purchase the underlying power generating assets and does not pay for them in any way up front”.
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“Private sector independent power producers construct and pay for the generating facility against a commitment from the government counterparty (in this case through Eskom) to purchase power generated over 20 years. It is not an asset purchase or design/construction agreement, which Eskom would typically conclude for the construction of its own power stations/generating assets,” it said.
The company continued: “It is in essence a long-term service provider agreement with payment dependent on and inextricably linked to continued performance.”