Ruling halts R350m Eskom contract
Eskom has been stopped from awarding a three-year, R350m contract for supplying lubricants to its power stations, with a ruling that it had not complied with its own procurement risk and governance protocols.
According to a Business Day report, Eskom had warned that the interdict would lead to an ‘unimaginable disaster’, with it running out of lubricant stocks by the middle of August.
KZN High Court (Pietermaritzburg) Judge Mahendra Chetty made his ruling after hearing argument in an urgent application launched by MX Distributors, which accused Eskom of being ‘anti-transformation’ by purporting to cancel a tender aimed at enhancing economic empowerment by targeting BEE-compliant companies.
In court papers, MX Distributors’ Mlungisi Nhlanhla said that while the tenders were being adjudicated it came to his attention that Eskom had put out a second ‘identical’ tender, which did not require any BEE compliance. While Eskom admitted it had issued a fresh tender in July with no BEE compliance stipulation, it said this was because the bidders for the first tender had failed the adjudication process.
Chetty said Eskom’s warning of a ‘disaster’ should the interdict be granted was an exaggeration.
‘The respondent has attempted to paint a picture of absolute calamity, which is an over-exaggeration. The respondent has had two years to finalise the first tender and only jumped into action in July 2019. In any event, Eskom has a process to cater for emergency supply from suppliers and it will not be left without oil.’
Chetty added: ‘There has been non-compliance with Eskom’s procedures and no proof that the first tender was properly cancelled. The interdict means Eskom cannot proceed with the award, pending a judicial review of its decision to cancel the first tender and the legality of the second tender.'
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