Paladin has ignored our requests to provide its estimate of the cost of rehabilitating Kayelekera, but we can safely say that the figure will be multiples of the US$10 million bond. Just keeping Kayelekera in care-and-maintenance costs US$10–12 million annually.
As things stand, if Paladin goes bankrupt and fails to rehabilitate Kayelekera, either rehabilitation will be coordinated and funded by the Malawian government (with a small fraction of the cost coming from Paladin’s bond) or the mine-site will not be rehabilitated at all.
It does Australian companies investing in mining ventures abroad no good whatsoever to leave Kayelekera unrehabilitated, a permanent reminder of the untrustworthiness and unfulfilled promises of an Australian miner and the indifference of the Australian government.
The company’s environmental and social record has also been the source of ongoing controversy and the subject of countless critical reports.
Julie Bishop, the WA government, Paladin and its administrators from KPMG need to liaise with the Malawian government and Malawian civil society to sort the rehabilitation of Kayelekera. An obvious starting point would be to prioritise the rehabilitation of Kayelekera if and when Paladin goes bankrupt and its carcass is being divided up. (picture below shows uranium sludge going to river)
Perth-based uranium mining company Paladin Energy was put into administration in July and the company is teetering on the brink of bankruptcy. Critics of the uranium industry won’t miss the company if it disappears. Other uranium mining companies won’t miss Paladin; in an overcrowded market, they will be pleased to have less competition.
But the looming bankruptcy does pose one major problem. Paladin’s Kayelekera uranium mine in Malawi, the ‘warm heart of Africa’, needs to be rehabilitated and Paladin hasn’t set aside nearly enough money for the job.
Under the leadership of founder and CEO John Borshoff, described as the grandfather of Australian uranium, Paladin has operated two uranium mines over the past decade. The Langer Heinrich mine in Namibia was opened in 2007, and Kayelekera in 2009.
They were heady days ‒ there was an endless talk about a nuclear power ‘renaissance’ and the uranium price tripled between June 2006 and June 2007. The Australian Financial Reviewreflected on Paladin’s glory days: “John Borshoff was once one of Western Australia’s wealthiest businessmen. The founder of Perth-based Paladin Energy developed an enviable portfolio of African uranium mines supposed to satiate booming global demand for yellowcake. When the company’s Langer Heinrich mine began shipments in March 2007, as the spot price for uranium eclipsed $US100 per pound, Paladin was worth more than $4 billion.”
Paladin was once the best-performed stock in the world according to The Australian newspaper. The company’s share price went from one cent in 2003 to A$10.80 in 2007. Borshoff made his debut on the Business Review Weekly’s‘Rich 200’ list in 2007 with estimated wealth of A$205 million.
But the good times didn’t last. The uranium bubble burst in mid-2007, and the Fukushima disaster in 2011 ensured that there would be no nuclear power renaissance and that the uranium industry would remain depressed for years to come. Borshoff left Paladin in 2015, and in 2016 Paladin’s new CEO Alexander Molyneux said that “it has never been a worse time for uranium miners”.
The loss-making Kayelekera mine in Malawi was put into care-and-maintenance in July 2014, leaving Paladin with the modest Langer Heinrich mine plus a number of projects the company describes as ‘nonproducing assets’ (such as uranium projects in jurisdictions that ban uranium mining).
Paladin was put into administration in July this year, unable to pay its debts. Even if Paladin sold its 75% stake in Langer Heinrich, its only revenue-raising project, it couldn’t repay all its debts.
Administrators from KPMG are attempting to sort out the mess and bondholders are reportedly being asked to fund a recapitalisation of Paladin. Bankruptcy would seem a much more likely option given the weakness of the company and the weakness of the global uranium market.
Paladin has said that a uranium price of about US$75 per pound would be required for Kayelekera to become economically viable ‒ almost four times the current uranium spot price, and well over twice the current long-term contract price. Even if the uranium price did rebound, Kayelekera would operate for only around four years; it isn’t a large deposit.
The likelihood of uranium prices reaching US$75 in the foreseeable future is near-zero. John Borshoff said in 2013 that the uranium industry “is definitely in crisis … and is showing all the symptoms of a mid-term paralysis”. Former World Nuclear Association executive Steve Kidd said in May 2014 that the industry is set for “a long period of relatively low prices, in which uranium producers will find it hard to make a living”. Nick Carter from Ux Consulting said in April 2016 that he did not anticipate a uranium supply deficit until the late 2020s. Other industry insiders and market analysts have made similar comments about the bleak future for uranium ‒ and the bondholders being asked to recapitalise Paladin would surely know that their money would be better invested in a long-shot at Flemington.
Who cleans up Kayelekera?
Assuming Paladin goes bankrupt, who cleans up the Kayelekera open-pit uranium mine? The company was required to lodge a US$10 million Environmental Performance Bond with Malawian banks, and presumably that money can be tapped to rehabilitate Kayelekera. But US$10 million won’t scratch the surface. According to a Malawian NGO, the rehabilitation cost is estimated at US$100 million ‒ ten times the amount set aside by Paladin. The cost of rehabilitating the Ranger uranium in the Northern Territory ‒ also an open-pit uranium mine, albeit larger than Kayelekera ‒ is estimated at just under US$500 million.
Paladin has ignored our requests to provide its estimate of the cost of rehabilitating Kayelekera, but we can safely say that the figure will be multiples of the US$10 million bond. Just keeping Kayelekera in care-and-maintenance costs US$10–12 million annually.
As things stand, if Paladin goes bankrupt and fails to rehabilitate Kayelekera, either rehabilitation will be coordinated and funded by the Malawian government (with a small fraction of the cost coming from Paladin’s bond) or the mine-site will not be rehabilitated at all.
Is it reasonable for Australia, a relatively wealthy country, to leave it to the overstretched, under-resourced government of an impoverished African nation to clean up the mess left behind by an Australian mining company? If the Malawian government cleans up Paladin’s mess, that will necessarily come at the expense of other priorities. Malawi is one of the poorest countries in the world. According to a 2013 U.N. report, more than half the population live below the poverty line, and about half of all children under the age of five show signs of chronic malnutrition.
Foreign Minister Julie Bishop should intervene to sort out the situation at Kayelekera and to prevent a repetition of this fiasco. We imagine that the Minister’s eyes might glaze over in response to a moral argument about the importance of Australia being a good global citizen. But there is also a hard-headed commercial argument for intervention to clean up Kayelekera.
It does Australian companies investing in mining ventures abroad no good whatsoever to leave Kayelekera unrehabilitated, a permanent reminder of the untrustworthiness and unfulfilled promises of an Australian miner and the indifference of the Australian government. Australia is set to become the biggest international miner on the African continent, perhaps as early as this year, according to the Australia-Africa Minerals & Energy Group. But Australian companies can’t expect to be welcomed if travesties such as Kayelekera remain resolved.
‘Overly sophisticated’
Back in 2006, John Borshoff told ABC television that Australia and Canada have become “overly sophisticated” with their thinking about environmental and social issues associated with the mining industry. Hence Paladin’s focus on projects in Africa.
One advantage ‒ if that’s the word ‒ of mining in Africa is that Paladin hasn’t had to set aside sufficient funds to rehabilitate Kayelekera. The company’s environmental and social record has also been the source of ongoing controversy and the subject of countless critical reports.
Paladin has lost money on Kayelekera, and the economic benefits for Malawi have been pitiful. Paladin has exploited the country’s poverty to secure numerous reductions and exemptions from payments normally required by foreign investors. United Nations’ Special Rapporteur Olivier De Schutter noted in a 2013 report that “revenue losses from special incentives given to Australian mining company Paladin Energy, which manages the Kayelekera uranium mine, are estimated to amount to at least US$205 million (MWK 67 billion), and could be up to US$281 million (MWK 92 billion) over the 13 year lifespan of the mine.”
The official line from Australia’s Department of Foreign Affairs and Trade is that “mining offers African countries an unparalleled opportunity to stimulate growth and reduce poverty. If well managed, the extractives sector can drive innovation, generate revenue to fund critical social services and upgrade productive physical infrastructure, and directly and indirectly create jobs.”
The reality at Kayelekera is starkly different from the picture painted by the bureaucrats in Canberra.
Two years ago, then WA Premier Colin Barnett told a mining conference in South Africa that Australian mining companies have “brought both expertise and ethical standards. It is a matter of pride for many companies that the standards applied in Australia are also applied in Africa.”
But standards at Kayelekera fall a long way short of Australian standards. Moreover, Barnett’s claims sit uncomfortably with the highly critical findings arising from a detailed investigation by the International Consortium of Independent Journalists. The Consortium noted in its 2015 report that since 2004, more than 380 people have died in mining accidents or in off-site skirmishes connected to Australian mining companies in Africa (there have been six deaths at Kayelekera). The reportfurther stated: “Multiple Australian mining companies are accused of negligence, unfair dismissal, violence and environmental law-breaking across Africa, according to legal filings and community petitions gathered from South Africa, Botswana, Tanzania, Zambia, Madagascar, Malawi, Mali, Cote d’Ivoire, Senegal and Ghana.”
Not even Collin Barnett would argue that Paladin is a source of pride for Australia. Quite the opposite. Likewise, Foreign Minister Julie Bishop surely didn’t have Paladin’s open-cut mine in mind when she told the Africa Down Under mining conference in Perth in September that many Australian mining projects in Africa are outposts of good governance and that the “Australian Government encourages the people of Africa to see us as an open-cut mine for lessons-learned, for skills, for innovation and, I would like to think, inspiration.”
Julie Bishop, the WA government, Paladin and its administrators from KPMG need to liaise with the Malawian government and Malawian civil society to sort the rehabilitation of Kayelekera. An obvious starting point would be to prioritise the rehabilitation of Kayelekera if and when Paladin goes bankrupt and its carcass is being divided up. Surely Kayelekera should take precedence over debtors such as French state-owned utility EDF, which is owed US$277 million by Paladin ‒ all the more so since the French state has its own sordid history of uranium mining in Africa.
Morgan Somerville is an International Relations student at La Trobe University. Dr Jim Green is the national nuclear campaigner for Friends of the Earth.
Financing for Eskom to develop nuclear program was discussed
Talks also included options to assist South African Airways
South Africa’s Finance Minister Malusi Gigaba met with representatives of the World Bank last week to discuss financing for development of a nuclear power program in the country, according to two people familiar with the meeting.
Gigaba met with the bank on Friday to discuss funding options available to state-owned power utility Eskom Holdings SOC Ltd. for the program, said the people, who asked not to be identified because the information is not public. South African Airways, the national airline that is struggling to meet debt obligations, was also discussed at the meeting, said one of the people.
Eskom last year began a process to add 9,600 megawatts of nuclear power capacity beyond its single existing plant by issuing a request for information from vendors. There were 38 responses to the notice, Kelvin Kemm, chairman of the South African Nuclear Energy Corp., told lawmakers in Cape Town on Tuesday.
South Africa’s nuclear investment plans have become a focal point for critics of President Jacob Zuma’s policies. The affordability of the program was a key point of dispute between Zuma and former Finance Minister Pravin Gordhan and the procurement process stalled in April after a provincial court ruled that the government didn’t follow the correct procedure in pursuing the nuclear program.
Gigaba declined to comment on Tuesday when asked about the meeting. The World Bank didn’t immediately respond to questions sent by email but confirmed receipt.
Gigaba said Oct. 26 that South Africa can’t afford to build new reactors for at least five years and that it doesn’t need more baseload, or continuous, power capacity. Nuclear still remains a part of the energy plan and the government will look at it as an option when needed and when it can afford it, he said.
South Africa Energy Minister David Mahlobo, who was appointed last month, said on Oct. 23 that a legal procurement process would be followed for a nuclear program, noting the Western Cape High Court decision.
The World Bank has previously supported energy projects through Eskom. However, an inspection panel from the organization in 2012 found instances of non-compliance in its award of a $3.75 billion loan to the utility for construction of the Medupi coal-fired power plant. The impacts and risks for other local water users weren’t properly considered and the project would place strain on water resources in an area already suffering from scarcity, it said at the time.
The discussions between Gigaba and the World Bank also included options to assist South African Airways, according to one of the people.
We’ll interdict any nuclear deal – DA Fin 24 Nov 05 2017 Liesl Peyper Cape Town – The Democratic Alliance (DA) says it is ready to interdict any attempt by Energy Minister David Mahlobo to force through a nuclear deal.
The party’s energy spokesperson Gordon Mackay said in a statement the DA will use “every legal and Parliamentary tool at its disposal” to ensure that South Africans won’t be “shackled” to the massive debt that will flow from an unaffordable and unnecessary nuclear deal, estimated at around R1trn.
City Press reported on Sunday that officials at the Energy Department have been forced to work overtime, including weekends, to complete the Integrated Resource Plan (IRP) by November 14 – four weeks ahead of schedule.
The IRP, which will determine the energy mix the country needs, was expected to be finalised in February next year, but will now be finished in the next two weeks………
Last week, Finance Minister Malusi Gigaba told City Press that nuclear energy was neither affordable for the sluggish economy, nor immediately necessary.
The stance was repeated by National Treasury deputy director general Michael Sachs who told Parliament on Friday that neither South Africa’s budget nor the country can afford nuclear.
Sachs said National Treasury in 2015 already said 9.6GW of nuclear energy would have a negative effect on the total debt burden and the balance of payments.
“It would not be prudent to proceed with that prior to the stabilisation of national debt and that stabilisation has been pushed out. All I can say over medium term we haven’t allocated resources. Our view is that it’s not affordable at present. I can’t give categorical commitments, but we don’t foresee it being affordable over the current medium term expenditure framework.”
Mahlobo, however, who has been in his new job for just more than two weeks after three years as state security minister, has contradicted Gigaba and National Treasury about South Africa’s pursuit of a nuclear build programme……….
Mahlobo was appointed Energy Minister early in October during a surprise Cabinet reshuffle, which some commentators took as a sign that SA wanted to fast-track its nuclear ambitions.
Mahlobo rushes nuclear deal, News 24, Setumo Stone, 5 Nov 17, As Energy Minister David Mahlobo forces his nuclear power plans into action, officials at his department are working weekends to finalise the country’s reviewed integrated energy resource plan – four months ahead of schedule.
The plan to determine the energy mix the country needs was expected to be finalised in February next year, but will now be finished in the next two weeks.
“We would have been talking February, but now we are talking November 14,” said an insider, vouching for the level of hard work the minister was putting into his job.
This would enable Mahlobo to make projections of the country’s future energy demands based on “empirical evidence”.
Last week, Finance Minister Malusi Gigaba told City Press that nuclear energy was neither affordable for the sluggish economy, nor immediately necessary. Mahlobo, who has been in his new job for just more than two weeks after three years as state security minister, is now on a collision course with Gigaba and Treasury.
The nuclear energy plan is expected to cost South Africa about R1 trillion, an amount that economists and politicians from across the spectrum – including the ANC – say the country’s struggling economy cannot afford. ……..
The countries with the leading technology are France, Russia, the US, South Korea and China. Companies from these countries as well as their governments have been aggressively wooing South Africa’s decision-makers and working to sway public opinion their way. But many believe that President Jacob Zuma’s cosy relationship with his Russian counterpart Vladimir Putin, as well as Mahlobo’s own close ties to the Kremlin and its security establishment, has already tilted the scales in that country’s favour.
When Mahlobo’s predecessor Mmamoloko Kubayi was moved out of the department in the Cabinet reshuffle last month, there was widespread speculation that it was because she was not moving with haste on the nuclear programme……….
Staff Writer5 November 2017 An Eskom contract manager allegedly received R20 million as a bribe to ensure Tubular Construction Projects got a large tender at the Kusile project, stated the Rapport.
According to the report, the money has been in the account of Hlakudi Translation and Interpretation CC since 2015.
France Hlakudi, an Eskom contract manager for the Medupi and Kusile projects, is the only member of the closed corporation. He denies there are any irregularities.
The report alleges that large sums of money were withdrawn from the account over the same period, suggesting it may have been used for money laundering.
These revelations were brought to light as a result of the disciplinary hearing of Matshela Koko, the suspended Eskom CEO.
Koko said Hlakudi must be removed from the Kusile project in February.
Koko allegedly did so without following the correct procedures, but he maintained he acted within his authority and he will testify about why he removed Hlakudi.
Rapport stated that a letter from a whistleblower to interim Eskom chair Zethembe Khosa also provides details about the R20-million payment.
Hlakudi is still the contract manager of Medupi and Kusile. The two projects have cost at least R160 billion to build – initial budgets were set at R118 billion.
The news comes alongside a report that Energy Minister David Mahlobo is forcing his nuclear energy plan into action.
While Eskom waits for its R1.5 billion from Trillian and McKinsey and company, thousands of people who installed solar geysers under the solar geyser home incentive scheme remain out of pocket.
The real number is unknown at this stage and the cessation of the programme – believed to be since January 2016 – speaks directly to Eskom’s appeal to the National Energy Regulator of South Africa to approve its request for a 19.9% price hike.
Eskom has become a victim of its own successful campaign during the rolling blackouts to use as little of its product as possible.
Now, it is producing surplus electricity – 5 600MW at peak in January – and is hell-bent on making as many people as possible pay for electricity to use its product.
It had 162 104 customers connected to the grid between January and October, and it appears the organisation is more focused on turning bucks than in green targets.
Meanwhile, the Independent Power Producer Procurement Programme has said: “South Africa has a high level of renewable energy potential and in line with the national commitment to transition to a low carbon economy, 17 800MW of the 2030 target (according to the IRP 2010) of newly generated power to be developed are expected to be from renewable energy sources, with 5 000MW to be operational by 2019 and a further 2 000MW (i.e. combined 7 000MW) operational by 2020.”
The question is why does Eskom and the department of energy (DE) not make surplus electricity available at a cheaper rate, for economic development.
The answer lies perhaps in an article on The Conversation by University of Johannesburg professor of physics Hartmut Winkler.
Winkler has postulated that two powerful lobbies against renewable energy were at work. “One is pro-coal, the other pro-nuclear. This has made the success of the renewable energy projects a target for attacks from interested parties in both,” said Winkler.
“Disrupting the renewable energy sector would ensure that the coal sector remains dominant. And that, over time, it is gradually displaced by nuclear,” he wrote.
“The lobby groups attached to coal and nuclear appear to have had powerful allies on the state utility’s board. There is mounting evidence that they have been furthering the interests of a group linked to the Gupta family,” Winkler claimed.
All the dithering, corruption and cover-ups have consequences for ordinary folk. Meanwhile, Eskom said the organisation has established the National Solar Water Heating programme on behalf of the DE.
For more than a week, Saturday Citizen has attempted to obtain answers from the DE, but its spokesperson, Johannes Mokobane, kept referring us to the website. – amandaw@citizen.co.za
Fin24 29th Oct 2017, Finance Minister Malusi Gigaba says drastic steps are needed to help South
Africa’s ailing economy – including freezing senior civil servants’
salaries and selling chunks of state-owned enterprises. In an exclusive
interview with City Press on Friday, Gigaba unveiled the surprise moves,
which include slamming brakes on the country’s estimated R1 trillion
nuclear build programme, saying it is neither affordable nor currently
necessary. https://www.fin24.com/Budget/gigaba-says-no-to-nuclear-20171029-3
Zuma was responding to a question in parliament by opposition leader Mmusi Maimane who asked why finance minister Malusi Gigaba had said the expansion would be delayed while energy minister David Mahlobo said the opposite.
“We have a policy of mixed energy and that includes nuclear,” Zuma said. “We are not saying we have changed policy … Its a question of timing, when do we do it. We have been discussing that issue all the time in the government.”
Romandie 31st Oct 2017,[Machine translation] NewCo, Areva’s entity resulting from the
restructuring of the nuclear group refocused on the fuel cycle, has had to
depreciate some of its assets, particularly the uranium mine Imouraren in
Niger, according to a statement released Tuesday.
NewCo published Tuesday its accounts for a shortened eight-month period (from January 1 to August
31, 2017), a decision taken as part of the restructuring of the group and
the exit of this entity from the tax consolidation perimeter so far
constituted around Areva SA. Although the published financial results
cannot be compared to the previous year of 12 months, the group
nevertheless indicated that it had spent 256 million euros in new
impairments between 30 June and 31 August.
Among them, 210 million euros concern mining assets, including 178 million euros for the only Imouraren
mine in Niger. The exploitation of this gigantic mine has been in abeyance
for several years, for want of a favorable conjuncture in civilian nuclear
power. Areva had already depreciated this asset twice, in 2015 and 2016, by
respectively 194 and 316 million euros. The new impairment losses are
linked to “both the unfavorable change in the euro-dollar exchange rate and
the unfavorable change in market price expectations” (of uranium), the
group said.
Energy Minister David Mahlobo repeated the mantra on the trillion-rand nuclear programme; that it will be done at a scale and pace the country can afford. Gaye Davis | about 4 hours ago
However, in his comments after Gigaba’s medium-term budget policy speech, Mahlobo appeared to favour a more bullish approach.
Democratic Alliance National Council of Provinces (NCOP) member Farhat Essack put the question: “You said that no one has the figures for a nuclear programme and that the government owns the numbers. Please explain to this House what exactly did you mean by that?”
Mahlobo repeated the mantra on the trillion-rand nuclear programme; that it will be done at a scale and pace the country can afford. Mahlobo says the opposition’s focus on nuclear has nothing to do with policy.
“It has everything to do with who gets the tender. I’m not in the business of tenders. I’m in the business of ensuring that you have energy here to pump our economy and we’re not going to be deterred in doing that.”
LISTEN: Will new Energy Minister push nuclear deal through?
Michael Shellenberger is visiting Australia this week. He has been a prominent environmentalist (of sorts) since he co-authored the 2004 essay, The Death of Environmentalism. These days, as the President of the California-based ‘Environmental Progress’ lobby group, he is stridently pro-nuclear, hostile towards renewable energy and hostile towards the environment movement.
Shellenberger is visiting to speak at the International Mining and Resources Conference in Melbourne. His visit was promoted by Graham Lloyd in The Australian in September. Shellenberger is “one of the world’s leading new-generation environmental thinkers” according to The Australian, and if the newspaper is any guide he is here to promote his message that wind and solar have failed, that they are doubling the cost of electricity, and that “all existing renewable technologies do is make the electricity system chaotic and provide greenwash for fossil fuels.”
Trawling through Environmental Progress literature, one of their recurring themes is the falsehood that “every time nuclear plants close they are replaced almost entirely by fossil fuels”. South Korea, for example, plans to reduce reliance on coal and nuclear under recently-elected President Moon Jae-in, and to boost reliance on gas and renewables. But Shellenberger and Environmental Progress ignore those plans and concoct their own scare-story in which coal and gas replace nuclear power, electricity prices soar, thousands die from increased air pollution, and greenhouse emissions increase.
Fake scientists and radiation quackery
Environmental Progress’ UK director John Lindberg is described as an “expert on radiation” on the lobby group’s website. In fact, he has no scientific qualifications. Likewise, a South Korean article falsely claims that Shellenberger is a scientist and that article is reposted, without correction, on the Environmental Progress website.
Shellenberger says that at a recent talk in Berlin: “Many Germans simply could not believe how few people died and will die from the Chernobyl accident (under 200) and that nobody died or will die from the meltdowns at Fukushima. How could it be that everything we were told is not only wrong, but often the opposite of the truth?”
There’s a simple reason that Germans didn’t believe Shellenberger’s claims about Chernobyl and Fukushima ‒ they are false. Shellenberger claims that “under 200” people have died and will die from the Chernobyl disaster, but in fact the lowest of the estimates of the Chernobyl cancer death toll is the World Health Organization’s estimate of “up to 9,000 excess cancer deaths” in the most contaminated parts of the former Soviet Union. And of course there are higherestimates for the death toll across Europe.
Shellenberger claims that the Fukushima meltdowns “killed precisely no one” and that “nobody died or will die from the meltdowns at Fukushima”. An Environmental Progress report has this to say about Fukushima: “[T]he science is unequivocal: nobody has gotten sick much less died from the radiation that escaped from three meltdowns followed by three hydrogen gas explosions. And there will be no increase in cancer rates.”
In support of those assertions, Environmental Progress cites a World Health Organization report that directly contradicts the lobby group’s claims. The WHO report concluded that for people in the most contaminated areas in Fukushima Prefecture, the estimated increased risk for all solid cancers will be around 4% in females exposed as infants; a 6% increased risk of breast cancer for females exposed as infants; a 7% increased risk of leukaemia for males exposed as infants; and for thyroid cancer among females exposed as infants, an increased risk of up to 70% (from a 0.75% lifetime risk up to 1.25%).
Applying a linear-no threshold (LNT) risk factor to the estimated collective radiation dose from Fukushima fallout gives an estimated long-term cancer death toll of around 5,000 people. Nuclear lobbyists are quick to point out that LNT may overestimate risks from low dose and low dose-rate exposure ‒ but LNT may also underestimate the risks according to expert bodies such as the US National Academy of Sciences’ Committee on the Biological Effects of Ionizing Radiation.
Gigaba says no to nuclear, Fin 24, 2017-10-29 – Sipho Masondo and Setumo Stone, Johannesburg – Finance Minister Malusi Gigaba says drastic steps are needed to help South Africa’s ailing economy – including freezing senior civil servants’ salaries and selling chunks of state-owned enterprises.
In an exclusive interview with City Press on Friday, Gigaba unveiled the surprise moves, which include slamming brakes on the country’s estimated R1 trillion nuclear build programme, saying it is neither affordable nor currently necessary.
“There was a time when it was felt that nuclear is necessary and it must be implemented and programmes were started. But it became clear, as the economy took a serious dip, that we were not going to afford nuclear, that the country couldn’t afford it and the budget couldn’t afford it,” he said.
“It is quite clear that, at present, we can meet our electricity needs and we can even meet them into the future, given the excess electricity that we have.”
Nuclear power, Gigaba said, will remain part of the country’s energy mix. However, this will only happen when the economy is growing fast, when there is “high uptake of electricity from intensive users, when we can see that we are reaching the stage where existing capacity is being fully utilised and the demand and supply margin is very narrow”.
Gigaba said it was not a “malicious view” to shelve the nuclear programme for now, considering the R50bn budget shortfall, a rising budget deficit, National Health Insurance, demands for free higher education, and a national debt to GDP ratio which is set to breach the 60% threshold by 2022.
“If you look at Eskom’s balance sheet, they will not be able to afford nuclear, they will need a guarantee from government. Government guarantees are ultimately state debt, because when a state-owned company cannot afford to pay the guarantees, the national fiscus needs to step in and pay. That is what happened at SAA,” he said…….http://www.fin24.com/Budget/gigaba-says-no-to-nuclear-20171029-3
While Finance Minister Malusi Gigaba indicated that we don’t have enough money for the project, Fitch says it seems that government is still pushing for the project to go ahead with the new Energy Minister driving the process.Ilze-Marie Le Roux , 27 Oct 17, CAPE TOWN– Global ratings agency Fitch has raised questions about whether South Africa’s big nuclear build really is on the back burner.
But in a bleak statement released on Thursday, Fitch says that the appointment of David Mhlobo as the new Energy Minister sends contradictory signals.
Fitch is sceptical about the status of the nuclear build, as the massive programme would see the construction of between six and eight nuclear plants with a very hefty price tag, a price tag South Africa just can’t afford at the moment.
Gigaba made that point crystal clear in his medium-term budget speech but ratings agency Fitch says it seems that government is still pushing for the project to go ahead with the new Energy Minister driving the process.
Fitch’s statement also raised concerns about the lack of a proper plan to cut spending or to raise revenue, saying that it suggests deep divisions within the ruling party.
Fitch has already downgraded both the country’s foreign and local denominated debt to sub-investment grade.
He was speaking ahead of his medium-term Budget speech, which did not mention nuclear power plans.
A new integrated resource plan on energy would provide more clarity, he said.
Proposals for a nuclear building project have been debated with a new urgency since weekend reports that President Jacob Zuma had recently met a Russian delegation.
Both the Presidency and the Russian embassy in Pretoria have denied that there was such a meeting, at which Zuma was said to have come under pressure to start implementing the nuclear power project with Russia.
Zuma’s cabinet reshuffle last week included the appointment of David Mahlobo as energy minister.
Mahlobo was reported to have travelled to Russia with convicts Gayton McKenzie and Kenny Kunene to facilitate a R5-billion nuclear deal with Russian company Rosgeo. Mahlobo was state security minister at the time of the trip.
Allegations that the energy sector has been captured go beyond the nuclear project. PetroSA is also being investigated.
Cope leader Mosioua Lekota says President Jacob Zuma is acting recklessly by looking to enter into nuclear deals with Russia.
Speaking at Parliament on Tuesday, Lekota said last week’s Cabinet reshuffle has paved the way for government to proceed with its nuclear ambitions despite a Western Cape High Court ruling in May that found five cooperation agreements signed by government to have been illegal.
He says Parliament should have interrogated the judgment and stopped Zuma from pressing ahead with his nuclear ambitions.
“The president has already shown the propensity to undermine the law, to ignore the Constitution and even the courts to go ahead with his business. We think once we have those numbers, the Speaker will have no choice but to call president Zuma to account.”
Last week, the Department of Environmental Affairs gave its approval for a site at Duynefontein adjacent to the Koeberg nuclear station in the Western Cape to become the first site for reactors as part of government’s nuclear build programme.
nuclear-news 