Day 3: 10 April

Talk on Kusile Power Station

For those who don't know my background, I spent 40 years in construction with major companies. I had 10 years with LTA based in Joburg working on projects in Secunda, Hoedspruit and of course Joburg. 

When I joined Stocks & Stocks we moved to Rustenburg to work at Sun City and surrounds for 11 years. We then moved to Windhoek, building throughout the country. We had 9 wonderful years based in Windhoek. Thereafter, 5 years in Durban building uShaka Marine World and eventually moved to CT in 2018 to get involved with the airport extensions preparing for the 2010 soccer World Cup.

Post the airport extension ending in 2010, our WP office supported the Gauteng office tendering for the building work of 87 buildings at Kusile Power Station. These were for the wet trades such as concrete foundations, brickwork, plaster, carpentry, etc.

My colleague, a Contracts Director, took ownership of the programming and I, as Commercial Director, would review the contractual obligations, which was a vastly modified Fidic international major contract document.

We joint ventured with Basil Read for the buildings over a period of 3 years, if I recall correctly. The tender value was about R1,4 billion. 

Our tender was among the lowest and was selected for adjudication, so our estimating team were summoned to meet at Eskom Megawatt Park with loads of attorneys, etc. My last project with LTA before moving to Stocks was a huge extension to Megawatt Park, so it was interesting seeing it fully operational.

Prior to the start of work, politicians had been promising local labour wonderful opportunities with construction of the huge power station, thereby creating unreal expectations. Our JV was awarded the project and we established site in the latter half of 2011. 

It wasn’t long until my bosses asked me to take over the commercial responsibilities of the site and I moved up in Feb 2012 somewhat reluctantly. I felt like I was being sent to Siberia. I stayed at a B&B in Pretoria East and was provided with a really nice Boere Supper every night.

I would get up at 5:15 and leave for site at 06:00 as this was a 1 hour drive. First stop was my Wild Bean coffee shop for a coffee and a sarmie. After work, I would leave site after the rush between 6:00 and 7:00 and would get home late. Not anything for Anne not knowing anyone in Pretoria, so I was wifeless and only had a weekend a month off to go home.

The project was managed by Black & Veitch, an American PM practice, and next to each B&V staff member was at least 1 local to shadow them. I think it lasted for a period of 2 to 3 years where after the locals took over.

All our labour had to be recruited via the Eskom Personnel Dept. A week prior to taking a site we would ask for say 15 labourers. Only 8 pitched up for work and 5 once given a pick and shovel, said they didn’t come to dig trenches but wanted to be flag men or banks men ( waving flags).

Several Taiwanese top-grade welders were brought onto site to do the critical welding of the boilers. The locals said they could do the job just as well despite not having any qualifications. They subsequently burnt staff buses as well as the canteen to make a point. The Taiwanese were sent home. The boilers took ages to get approval from the X-ray testing procedures and have proved to be a weakness in the plant.

My senior QS and I negotiated new rates for items not in our document (BoQ) and we settled the rates as well as a claim for delays to the first building. Their panel included their PM, an attorney, junior attorney, a QS and his assistant. I confirmed our agreement in writing the following day.

Some 2 months later, at one of our site meetings, their PM said that Head Office had rejected our agreement in toto. I got so angry and this became a turning point for me. One of our subcontractors told me that in order to settle a claim, one had to contribute monies to a creche project of theirs or something similar. The writing was on the wall that brown envelopes were the way in which the PM wanted to do business.

After 6 months on site and having turned 60, I decided to retire and gave the company 3 months’ notice. Stefanutti Stocks are today relying on the settlement in court of a claim worth several hundred million Rands. Basil Read had closed in the interim.

So contrary to Alistair Campbell’s recent talk at one of our meetings, not all the contractors fed from the corruption trough. A lesson never to generalize. For the honest guys, it was somewhat of a nightmare, with the project running some 8 years late and incurring huge expense.

Any questions?