Eskom is quantifying R841m loss at Kusile
POWER utility Eskom is in the process of quantifying losses incurred in the R841 million accommodation building for workers at the Kusile power station.
This was revealed by Public Enterprises Minister Pravin Gordhan in his written response to parliamentary questions by DA MP Benedicta van Minnen.
The incomplete project, known as Wilge Residential Development Project, was initially costed at R260m but it ballooned to more than R800m when it was halted in 2019.
“Eskom is in the process of quantifying the losses incurred and the parties against whom legal actions should be taken. Counsel has been engaged to advise on the merits of intended action,” Gordhan said.
In separate responses to DA MP Michele Clarke, Gordhan said an open tender process was followed for the project and 24 companies submitted tenders. He said that the Liviero Wilge Joint Venture was contracted to build the 336 units by December 2013.
“The duration of the contract was 18 months and the accepted contract price was R226 485 875.455 excluding value-added tax and cost price adjustment,” he said.
Gordhan said although the initial contract was R226.5m, the final monetary value at adjudication was R600.48m. “The cost incurred to date is R632.64m on the development of the flats paid to Liviero Wilge Joint Venture and an additional R209.23m on common infrastructure and related work paid to other service providers,” he said.
Gordhan said R841.87m has been paid to service providers. His replies show that R40.6m was spent on accommodation during the construction of the flats. He also said Eskom instituted disciplinary action in 2019 against the general manager for group capital division facilities, Reuben Mamorare, for the wasteful expenditure.