Dodgy SA Express fuel deal comes under scrutiny
Company abandoned contractual obligations
IRREGULAR contractual benefits and desertion of its contractual obligations were some of the accusations levelled against Pretoria-based empowerment company, EML Engineers and Construction, as testimony of its contracts with SA Express and SAAwere scrutinised at the Zondo commission.
EML had secured jet fuel supply contracts with the two state-owned airlines in 2017 and last year respectively.
Yesterday, SA Express airport co-ordinator Estelle Loock told the commission how EML’s jet fuel supply tender was irregularly expanded by the state-owned airline in 2017, resulting in the contract ballooning to R2.4 billion.
Loock added that EML had been roped in after the airline experienced jet fuel problems at Pilanesberg Airport in the North West, where a supplier which was previously approved by the Airports Company of SA (Acsa) was flagged for supplying fuel with a questionable quality.
Loock said she was tasked to find a solution as SA Express aircraft from Cape Town had to refuel in Pilanesberg, which resulted in a resolution for a deviation.
While she initially requested quotation from EML for the transportation of 8 500 litres of fuel per week from Joburg to Pilanesberg, the scope of EML was expanded beyond the specified deviation when she had handed the process to the then chief procurement officer Sam Vilakazi for finalisation, she said. “Only at the later stage when it was sent to my divisional manager that I was aware that there was a contract signed,” Loock said.
The dodgy deal, which was expanded to include provision of fuel to stations where SAA was contracted to supply fuel at a 30% price hike, would see EML being paid R67 million a month.
“The problem with this was that the services that were required were only two, which was on the technical side of the refuelling and de-fuelling and on the Pilanesberg side of fuel supply.
“However, this contract contained every single station that SA Express operated in, which was a concern. I was aware that there was an SAA agreement at the Acsa airports; however all those were included in this agreement,” Loocke said.
SAA head of fuel management Mark Vaughan said the national carrier was not bothered by reported allegations of dodgy dealings between SA Express and EML when hired on a yearlong fuel supply contract on July 1 last year.
“My question was to the team (sic) our process regular. There was a tender process that took place and we had evaluated EML with everyone else and they have come out with a competitive bid,” Vaughan said.
He added that EML, whose contract for the supply of 2 million litres of jet fuel is coming to an end at the end of this month, had only supplied SAA for 15 days after the contract started in July and again from two months in September and October before abandoning the contract.
“Since that point up until today we have not received anything from EML. So they supplied fuel to EML for two months and 15 days,” he said.
He aid EML had initially been roped in as part of the SAA’s push by the former board under Dudu Myeni for transformation within its procurement space.