Shocking details of the secret nuclear deal that Energy Minister Tina Joemat-Pettersson signed with Russia last year can, for the first time, be revealed. The text, which has been jealously guarded by her department and Russian nuclear company Rosatom, holds many dangers for South Africa.
It creates an expectation that Russian technology will be used for South Africa’s trillion-rand fleet of new nuclear power stations. And by laying the groundwork for government-to-government contracting, it appears designed to sidestep the constitutional requirement for open and competitive tendering.
Once the agreement comes into force, the Russians will have a veto over South Africa doing business with any other nuclear vendor. And it will be binding for a minimum of 20 years, during which Russia can hold a gun to South Africa’s head, in effect saying: “Do business with us, or forget nuclear.”
The agreement confirms the government’s intention to make “Atomic Tina’s” energy department the procuring agent for the nuclear programme rather than Eskom – where the country’s nuclear expertise lies, despite the utility’s travails. Joemat-Pettersson signed the agreement in Vienna on September 21 last year, three weeks after President Jacob Zuma held talks with his Russian counterpart, Vladimir Putin, at the latter’s country estate.
- Download the original signed agreement (Russian version)
- Download an English translation of the agreement
It led to an immediate outcry as it appeared that Russia was being favoured over other vendor countries. But the energy department said the agreement merely “initiates the preparatory phase for the procurement for the new nuclear build programme” and it undertook to sign agreements with other nuclear vendors – France and China – next.
It asserted again this week that it is still “engaged in the preprocurement phase” and the “type and nature of [the] procurement process has not been approved by Cabinet”.
The department has refused amaBhungane and others’ requests under the Promotion of Access to Information Act for copies of the Russian, French and Chinese agreements, citing “the delicate process of negotiations … with other countries”.
The terms of the agreement lean heavily in Russia’s favour. They:
- Indemnify the Russians from any liability arising from nuclear accidents during the reactors’ life. The agreement says South Africa is “solely responsible for any damage both within and outside the territory of the Republic of South Africa”;
- Hand the Russians a host of regulatory concessions and “special favourable treatment” in tax and other financial matters, but offer South Africa no such incentives; and
- Require Russia’s permission if South Africa wants to export nuclear technology it develops locally as a result of learning from the Russians, thereby hindering government’s aim that the nuclear new-build programme will develop a globally competitive local nuclear industry.
David Unterhalter, a University of Cape Town law professor and constitutional expert, this week said the agreement appeared to go far beyond the type of general framework document that government officials have declared it to be.
“While it could perhaps be argued that the [introductory] provisions could be understood as forming a general co-operation agreement, when one gets down among the weeds it seems pretty clear that this is not just an agreement to agree.
“There is a number of specific matters dealt with in a way that suggests this agreement is intended to give rise to executable obligations … in other words obligations that appear to be enforceable even if via diplomatic rather than legal channels.”
The agreement is to be tabled in the National Assembly and the National Council of Provinces before it becomes binding, but there is uncertainty about the process to be followed.
AmaBhungane has obtained copies of the equivalent co-operation agreements concluded with Korea in 2011 and the United States in 2009. In contrast to the Russian agreement, these specify more general collaboration on nuclear matters, do not refer to specific technologies and do not use decisive language.
The department has concluded agreements with France and China since the Russian deal, but these remain under wraps.
Numerous officials in the department of energy, international relations, trade and industry, as well as in the treasury and the chief state law adviser, raised concerns about clauses in the draft Russian agreement, which the Russians first put on the table in mid-2013, after Zuma paid Putin a “working visit” to the Black Sea resort of Sochi.
But these officials were ignored and, in some cases, sidelined.
A comparison with an earlier draft shows some clauses to which they objected have been retained almost unchanged in the signed version, and others with only minor revision.
AmaBhungane understands chief state law adviser Enver Daniels provided detailed input on the draft agreement but was given no insight into the version Joemat-Pettersson signed. He was not privy to whether his advice had been followed.
Instead, the process of finalising the agreement was managed by a powerful group of officials in the energy department, two of whom accompanied Zuma to Russia on his “medical” holiday last August, a month before the deal was signed.
One official, Senti Thobejane, is nominally special adviser to Joemat-Pettersson, but is also believed to advise Zuma and the ANC on nuclear matters. The other official, Zizamele Mbambo, is deputy director general for nuclear in the energy department. Both officials were present at the signing ceremony in Vienna.
Mbambo denied ignoring other departments’ input: “[They] commented on the agreement and their comments were addressed.”
Rosatom said it needed to send answers it had prepared to the energy department for feedback first: “It would not be ethical in our minds to divulge information unilaterally on a bilateral agreement.”
Presidency spokesperson Mac Maharaj also said he was “awaiting feedback”.
Last night, Zuma told Parliament in his state of the nation address that “all … countries will be engaged in a fair, transparent, and competitive procurement process to select a strategic partner or partners to undertake the nuclear build programme”.
He set an ambitious target of connecting the first unit to the grid within seven years. – Reporting by Lionel Faull, Sam Sole and Stefaans Brümmer
Source: Mail & Guardian