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Judge rescinds Eskom’s R96 million pipeline maintenance tender at Matla power station

A tender of R96 million issued by Eskom for pipeline maintenance at its Matla power station in Kriel, Mpumalanga, has been overturned by the Gauteng High Court, Johannesburg.

The court found the power utility was “selective” in treatment of the two companies that were the front-runners. Acting Judge N Redman said the conduct of Eskom was “concerning”. Eskom invited bidders in July, 2020 for pipeline maintenance at its Kriel slurry and ash plant for 36 months.

At least 12 bids were received for the multimillion-rand contract, including that of Mbali Industrial Solutions (applicant) and Thenga Holdings. Four bids were disqualified as they did not meet the criteria. The remaining eight were technically evaluated.

The front-runner was Mbali, which scored 100% in its bid, with Thenga on its heels. Mbali’s financial statements were subsequently sent to Eskom’s finance department to assess its capability to carry out the project.

According to the evaluator (whose identity was not disclosed to the court), Mbali was not financially sound enough to be awarded the tender. It suggested Mbali could only be considered for a tender not exceeding R21 million over three years.

Eskom meanwhile held negotiations with both Mbali and Thenga in 2021. The tender committee then recommended the tender be awarded to Mbali at a contract value of R71.2m – the discounted price agreed to by Mbali.

Eskom’s finance department, however, expressed its concern about the award to Mbali as it had already been awarded another contract with Eskom. It emerged Eskom had then negotiated the tender price with Thenga and the bidder agreed to match the reduced price offered by Mbali. Eskom then decided to award the tender to Thenga.

Mbali subsequently turned to the high court to have the tender reviewed and set aside. While Mbali did not complain about the fact that its finances were analysed, it did object that this was never done with regard to Thenga. Judge Redman found that Eskom was selective in its treatment of the tender bids: “This is irrational and unfair.”

The question of who should be awarded the tender was remitted to Eskom’s procurement authority for reconsideration.

Source: www.iol.co.za

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Judge rescinds Eskom’s R96 million pipeline maintenance tender at Matla power station

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