Zuma’s pals in R5bn gas deal

‘New Gup­tas’, for­mer con­victs Kunene and McKen­zie, in­tro­duced as ‘BEE part­ners’ on Moscow jun­ket

Sunday Times - - FRONT PAGE - By MZILIKAZI WA AFRIKA and THANDUXOLO JIKA

South Africa’s “new Gup­tas” — for­mer jail­birds Gay­ton McKen­zie and Kenny Kunene — are be­ing lined up as BEE part­ners in a lu­cra­tive deal with a Rus­sian oil com­pany, thanks to their in­creas­ingly cosy re­la­tion­ship with Pres­i­dent Ja­cob Zuma.

The Sun­day Times can re­veal that the two con­victs-turned-politi­cians trav­elled to Rus­sia at the same time as State Se­cu­rity Min­is­ter David Mahlobo and a del­e­ga­tion from South Africa’s Cen­tral En­ergy Fund to sell them­selves to Rus­sian com­pany Ros­geo as pos­si­ble BEE part­ners.

Last week, the Sun­day Times re­ported that the pair have such in­flu­ence with Zuma that they were in a po­si­tion to nom­i­nate a fu­ture deputy min­is­ter of higher ed­u­ca­tion.

The state-owned en­tity and govern­ment of­fi­cials were in Moscow to meet with Ros­geo — just a week be­fore the R5-bil­lion gas deal was signed on the side­lines of the Brics sum­mit in Xi­a­men, China, on Septem­ber 4.

ANC in­sid­ers have said the pair, widely re­garded as “the new Gup­tas”, have ac­cess to “the big house” — Zuma’s of­fi­cial res­i­dence Mahlamba Nd­lopfu — and are us­ing their in­flu­ence to seek favours.

The Sun­day Times has es­tab­lished that McKen­zie and Kunene flew first class with Mahlobo and CEF chair­man Luvo Makasi from South Africa to Dubai on Emi­rates flight EK 0766 on Sun­day Au­gust 27. Makasi’s ad­viser, Anda Bici, flew business class.

‘Black­mail­ing’

The group ar­rived in Dubai on Au­gust 28 and flew out to Moscow on flight EK 0133, and stayed at the Ritz-Carl­ton.

In Moscow, Bici and Makasi met with Ros­geo rep­re­sen­ta­tives to fi­nalise de­tails of the R5-bil­lion deal, the CEF con­firmed. It is un­der­stood that McKen­zie, Kunene and Mahlobo met sep­a­rately with Ros­geo.

The group left Moscow on Au­gust 29, on EK 0132 for Dubai, and flew back to South Africa on EK 0761.

“I know for a fact that Gay­ton and Mahlobo were in Moscow a week be­fore the Brics sum­mit in China two weeks back,” said a se­nior govern­ment of­fi­cial.

Makasi con­firmed McKen­zie and Kunene were in Rus­sia at the same time as he was there with his team. “I saw them in Dubai and spoke to them briefly but I don’t know what their business was in Rus­sia,” he said.

Bici said the “pur­pose of the visit was to lis­ten to Ros­geo’s pro­posal, which they have been in talks with PetroSA on for five years or so”.

An­other se­nior govern­ment of­fi­cial told the Sun­day Times that Kunene and McKen­zie were in­tro­duced to Ros­geo CEO Ro­man Panov, in the pres­ence of Mahlobo, on Au­gust 28 as suit­able BEE part­ners.

The se­nior govern­ment of­fi­cial said Mahlobo’s pres­ence was to “strengthen their cred­i­bil­ity” as business peo­ple.

An of­fi­cial in the se­cu­rity clus­ter said: “Mahlobo has been run­ning around and or­gan­is­ing deals for Gay­ton and Kenny. It is still not clear whether they are his proxy or they are black­mail­ing him to do as they say.

“Gay­ton and Kenny used Mahlobo as a mas­ter key to in­fil­trate the se­cu­rity clus­ter.”

Mahlobo did not re­spond to ques­tions

[The state se­cu­rity min­is­ter] has been run­ning around or­gan­is­ing deals for Gay­ton and Kenny Se­cu­rity clus­ter of­fi­cial

yes­ter­day.

It is not clear how McKen­zie and Kunene learnt about the deal, but two months be­fore it was signed, their close ally Leanne Wil­liams, who was a Jo­han­nes­burg city coun­cil­lor for their po­lit­i­cal party, Pa­tri­otic Al­liance, was ap­pointed to the PetroSA board. She has since re­signed, af­ter blow­ing the whis­tle on cor­rup­tion at the state en­tity.

News of the Rus­sian trip has been do­ing the rounds in ANC cir­cles. A na­tional ex­ec­u­tive com­mit­tee mem­ber told the Sun­day Times that the two were ear­marked as BEE part­ners in the PetroSA deal — and the deal it­self was “seen as a con­so­la­tion to the Rus­sians be­cause the pres­i­dent [Zuma] has so far not de­liv­ered the nu­clear deal”.

Ros­geo had not re­sponded to ques­tions at the time of go­ing to press.

McKen­zie and Kunene’s trip to Moscow came just a month af­ter En­ergy Min­is­ter Mmamoloko Kubayi led a del­e­ga­tion of se­nior of­fi­cials to an in­ter­na­tional fo­rum in Rus­sia. While there Kubayi and her Rus­sian coun­ter­part dis­cussed “var­i­ous op­tions in the nu­clear and en­ergy space”.

She also met state-owned en­ergy com­pany Rosatom’s ex­ec­u­tives to dis­cuss is­sues around the nu­clear build pro­gramme. The Depart­ment of En­ergy could not be reached for com­ment yes­ter­day.

This week a fum­ing Kunene, who has in the past worked as a PR con­sul­tant and lob­by­ist for min­ing com­pa­nies, re­fused to an­swer ques­tions about the trip or con­firm a meet­ing with Ros­geo. In­stead he threat­ened le­gal ac­tion against the Sun­day Times.

Gas ex­plo­ration

“I am not go­ing to f ***** g an­swer . . . I am not go­ing to an­swer to your agenda . . . Do you ask your boss Cyril Ramaphosa where he has trav­elled?” he said.

McKen­zie did not deny trav­el­ling to Moscow, but de­nied trav­el­ling with Mahlobo and de­clined to com­ment on the pur­pose of the trip. He only ad­mit­ted to meet­ing Makasi and Bici in Dubai for cof­fee.

“Since when do I re­port my deals to you or any­one in me­dia? Your pa­per last week in­ti­mated that I am get­ting train­ing to be a spy, this week I’m sign­ing a deal. Stay on story.”

PetroSA is yet to an­nounce who the lo­cal part­ner will be in the Ros­geo deal, which will al­low the com­pany to con­duct ex­plo­ration work for the ex­trac­tion of 4 mil­lion cu­bic me­tres of gas daily, to be de­liv­ered to the gasto-liq­uid re­fin­ery in Mos­sel Bay.

The deal in­volves devel­op­ment in the ex­plo­ration areas of blocks 9 and 11a off South Africa’s south­ern coast. Ros­geo is sup­posed to con­duct a con­sid­er­able vol­ume of ge­o­log­i­cal ex­plo­ration work. In par­tic­u­lar, it is planned to carry out more than 4 000km² of 3-D seis­mic op­er­a­tions and over 13 000km of grav­ity-mag­netic ex­plo­ration works, as well as the drilling of ex­ploratory wells. The es­ti­mated vol­ume of the in­vest­ment is $400mil­lion (R5.2-bil­lion).

“All projects within the coun­try need to con­form to laws that in­clude leg­is­la­tion on BEE,” said PetroSA spokesman Thabo Mabaso. “How­ever . . . for now no lo­cal part­ners have been fi­nalised. We will an­nounce such a part­ner when the mat­ter is con­cluded [af­ter] ne­go­ti­a­tion be­tween PetroSA and Ros­geo.” He said the pre­rog­a­tive to ap­point a BEE part­ner lay with Ros­geo, and PetroSA would do due dili­gence on the part­ner.

McKen­zie, who is the leader of the Pa­tri­otic Al­liance, and busi­ness­man Kunene are said to be the mas­ter­minds be­hind e-mails pub­lished in the Sun­day In­de­pen­dent that pur­ported to show that Deputy Pres­i­dent Cyril Ramaphosa was hav­ing a string of af­fairs with young women. Kunene — who last week claimed he had been shot at — was this week or­dered by the High Court in Jo­han­nes­burg to re­move sex­u­ally ex­plicit im­ages of one of the women from his web­site.

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