Karpowership demands retraction from De Ruyter, denies it is corrupt
Karpowership, the Turkish company seeking to supply power to South Africa, said it will demand a retraction from Andre de Ruyter, the former CEO of Eskom Holdings, because it said he had inferred the firm was corrupt.
The company, which generates electricity from ship-mounted, gas-fired power plants, in 2021 won about 60% of an emergency tender seeking to secure 2 000 MW of power to ease shortages that have plagued South Africa for almost 15 years. Court challenges from rival bidders and environmentalists and a yet-to-be resolved delay in getting Eskom, the national power utility, to sign a power-purchase agreement have stalled the deal.
In an wide-ranging interview broadcast on South Africa’s ETV television channel on Feb. 21, De Ruyter said a search on Karpowership would reveal that “there is an extensive legacy of alleged corruption, breaches of contract and abuse” when it comes to the company’s dealings with countries that have used its ships.
De Ruyter’s comments “inferred, if not directly represented, that Karpowership is corrupt,” the company said in a statement sent to Bloomberg. “Karpowership unequivocally and unconditionally denies any allegations of impropriety on its part and rejects and dismisses insinuations of corruption.”
The interview, in which De Ruyter also said Eskom had fallen victim to corruption involving officials from the ruling African National Congress, has seen the former CEO attacked by government ministers who questioned his motives and blamed him for power cuts. While he was due to leave at the end of March, Eskom’s board asked him to leave the day after the interview was broadcast. Opposition parties, the ANC and labour unions have demanded he reveal who he was implicating.
De Ruyter didn’t immediately respond to an email and text message from Bloomberg seeking a response.
The government’s decision to award Karpowership the bulk of the emergency tender met stiff opposition from climate activists and other civil society organizations because of the cost of the 20-year contract and the potential environmental impact the three power plants would have.
“There is absolutely no justification for concluding a 20-year agreement with a company that can raise the anchor, literally, and literally sail away with the asset the country has paid for,” De Ruyter said in the interview.
The Turkish company said the government would be paying for the power and not the assets, and it was assuming all of the risk as it would need to meet strict performance requirements.
“Defaulting on the power purchase agreement would not only give rise to damages for breach of contract, but very significantly would mean that Karpowership would not recover anything for a significant upfront investment,” the company said.
It also said Eskom’s demand that it sign an indemnity agreement, when none had been requested from other successful bidders in the tender, was irregular. Nevertheless it had offered to make amendments to “the power purchase agreement anti-corruption undertakings,” and provide indemnity for any legal costs the utility might incur.
Comments
Press Office
Announcements
What's On
Subscribe to improve your user experience...
Option 1 (equivalent of R125 a month):
Receive a weekly copy of Creamer Media's Engineering News & Mining Weekly magazine
(print copy for those in South Africa and e-magazine for those outside of South Africa)
Receive daily email newsletters
Access to full search results
Access archive of magazine back copies
Access to Projects in Progress
Access to ONE Research Report of your choice in PDF format
Option 2 (equivalent of R375 a month):
All benefits from Option 1
PLUS
Access to Creamer Media's Research Channel Africa for ALL Research Reports, in PDF format, on various industrial and mining sectors
including Electricity; Water; Energy Transition; Hydrogen; Roads, Rail and Ports; Coal; Gold; Platinum; Battery Metals; etc.
Already a subscriber?
Forgotten your password?
Receive weekly copy of Creamer Media's Engineering News & Mining Weekly magazine (print copy for those in South Africa and e-magazine for those outside of South Africa)
➕
Recieve daily email newsletters
➕
Access to full search results
➕
Access archive of magazine back copies
➕
Access to Projects in Progress
➕
Access to ONE Research Report of your choice in PDF format
RESEARCH CHANNEL AFRICA
R4500 (equivalent of R375 a month)
SUBSCRIBEAll benefits from Option 1
➕
Access to Creamer Media's Research Channel Africa for ALL Research Reports on various industrial and mining sectors, in PDF format, including on:
Electricity
➕
Water
➕
Energy Transition
➕
Hydrogen
➕
Roads, Rail and Ports
➕
Coal
➕
Gold
➕
Platinum
➕
Battery Metals
➕
etc.
Receive all benefits from Option 1 or Option 2 delivered to numerous people at your company
➕
Multiple User names and Passwords for simultaneous log-ins
➕
Intranet integration access to all in your organisation