Business Day

Tender process was fair — Areva

- FRANNY RABKIN Law and Constituti­on Writer rabkinf@bdfm.co.za

FRENCH nuclear firm Areva yesterday defended Eskom’s decision to award it the R4.3bn Koeberg tender, saying the tender process was highly detailed and substantiv­ely fair.

FRENCH nuclear company Areva yesterday defended Eskom’s decision to award it a R4.3bn tender to replace steam generators at the power utility’s Koeberg nuclear power station, saying the tender process was highly detailed and substantiv­ely fair.

A central issue in the court battle between Eskom, Areva and American company Westinghou­se, which lost out on the tender, was whether Eskom’s decision was based on criteria introduced late in the day, as claimed by Westinghou­se. Areva yesterday argued that Eskom’s original tender requiremen­ts covered all the factors considered by Eskom.

Koeberg contribute­s 5% (1,960MW) to Eskom’s overall electricit­y supply, but it is SA’s only nuclear power station and is considered crucial in the government’s long-term nuclear commitment of 9,600MW by 2023.

Over three days, the Johannesbu­rg High Court heard that while Westinghou­se’s bid was cheaper, Eskom’s board tender committee favoured Areva because of “strategic considerat­ions” and because Areva, in its schedule for completing the job by 2018, detailed how it could give a three-month margin for error — a “float”. Westinghou­se did not detail its own float, saying it would only do so once the tender had been awarded.

On Tuesday counsel for Westinghou­se, Jeremy Gauntlett SC, said these strategic considerat­ions and the float were introduced at the last minute and were a deviation from the original criteria.

But counsel for Areva, Peter Hodes SC, said yesterday that if the tender requiremen­ts were read reasonably — as required by the law — everything was covered. There was “no need to resort to complex legal argument” because the facts answered the question.

While the board tender committee’s letter to Public Enterprise­s Minister Lynne Brown did not explicitly mention a float, it did clearly refer to the importance of bidders’ ability to meet the 2018 deadline and the associated risks, said Mr Hodes.

Westinghou­se used an “ill-considered negotiatin­g technique” when it refused to disclose details of its own float, said Mr Hodes. “You make your bed, you lie in it,” he said.

The standards for the tender requiremen­ts demanded by Westinghou­se were so high that they were “untenable and impractica­l and not required by law”.

But Mr Gauntlett hit back, saying that Mr Maleka had, on Tuesday, “conceded” that the strategic considerat­ions were not part of the original tender requiremen­ts.

He said the rules had been set; and if the rules were to change, the game had to be restarted.

Judge Zeenat Carelse reserved judgment.

 ??  ?? Koeberg nuclear power station at sunset
Koeberg nuclear power station at sunset

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