Losing Bidder Claims 2000MW Risk Mitigation IPP Procurement Tender is Rigged

• DNG Power is asking the high court in South Africa to overturn the government’s appointment of preferred bidders for the supply of emergency power in the country’s 2000MW Risk Mitigation Independent Power Procurement Programme Tender (RMIPPPP), claiming the tender process was “grossly and blatantly flawed, corrupt and procedurally unfair”.
• The Department of Mineral Resources and Energy confirms receipt of a High Court application from DNG Power Holdings and intend to oppose the matter in court.  

The explosive allegations have been made in an affidavit by Aldworth Mbalati, the founder and chief executive of DNG Power Holdings in a high court application this week. His company had hoped to win a substantial part of the RMIPPPP tender.

Related news: 8 preferred bidders announced for RMIPPPP tender

Mbalati points to a series of decisions allegedly designed to benefit the Karpowership consortium, which won the lion’s share. In his affidavit, he describes a sinister meeting with top officials and alleged associates of the Mineral Resources and Energy Minister, Mr Gwede Mantashe.

Mr Aldworth Mbalati, the founder and chief executive of DNG Power Holdings. Image credit: DNG

According to him, they allegedly offered him a majority share of the 2 000-megawatt programme first before most of it got awarded to the controversial Turkish-led Karpowership SA instead. Read more

In his affidavit, Mbalati recounts being courted by “a businessman with close ties to [Mantashe]” last July, a month before the mineral resources and energy department (DMRE) published the bid. The businessman, whom he does not name, allegedly told Mbalati that the tender would soon be released – and that the outcome would be predetermined.

The businessman, Mbalati states, insisted that DNG “should be assisted by certain undisclosed parties should it wish to be a preferred bidder and ultimately be awarded the tender” and that he, the businessman, would be able to “facilitate the relationship with the undisclosed parties”.

Mbalati states that he refused to be associated with any collusion or unlawful conduct.

The Department of Mineral Resources and Energy wishes to reiterate that the Risk Mitigation Independent Power Producer Procurement Programme, as with all IPP Procurement Programmes, was implemented in accordance with Section 217 of the Constitution, the PFMA, the PPPFA (insofar as it relates to process, considering the exemption therefrom) and all other procurement related legislation, which gives effect to the principles of a process that is fair, equitable, transparent, competitive and cost-effective, while also complying with the principles in the Promotion of Administrative Justice Act.

Author: Bryan Groenendaal