PetroSA R15.6 Billion Impairment: DA Demands Prosecution Against Those Behind The Billions Wasted


South Africa’s Democratic Alliance (DA) party is pissed about PetroSA R15.6 billion impairment. And, has charged that the individuals responsible for the billions wasted must be prosecuted.

The PetroSA R15.6 billion impairment according to the DA, includes the R14.5 billion identified in the 2014/15 financial year and another R1.1 billion impairment for the current 2016/17 financial year.

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BuzzSouthAfrica gathered that the Committee on Energy was informed about the 2016/17 financial year impairment today.

Commenting on this, DA shadow Minister of Energy, Gordon Mackay MP explained that an impairment is an expense when the book value of an asset exceeds the recoverable amount of that asset. With that, Mackay wailed thus:

“This is on top of another forensic report that was presented to the Committee on the monumental impairment of R14.5 billion in the 2014/15 financial year, the majority of which was due to the failed Ikhwezi ocean-gas project.”

Based on the foregoing, DA indicated that it will request for a full forensic report. That, will be done in order to obtain a second opinion by another independent law firm on possible prosecutions against those responsible for the billions wasted.

The party contended that the value of the loss has “completely justified” the quest for a second opinion.

Also, DA disclosed that it will demand of the Minister of Energy, Tina Joematt-Pettersson, to account for the appointment of the current board that presided over the further R1.1 billion impairment.

“Minister Joematt-Pettersson must also fast track the recommendations of the Presidential Review Commission. This must include a review of all contracts to ensure executives are awarded bonuses on performance and not on being retained only,” added the party.

From our gatherings, the forensic report as presented to the Committee on Energy has two major findings. First, the Ikhwezi ocean-gas project failed to deliver on its gas promises.

And, there were massive project management problems ranging from changes in contractors to overruns, delays and a disconnect between the board and management.

DA frowned that the only punishment in relation to this R14.5 billion loss was “two golden handshakes for the ex-CFO and the ex-CEO and a demotion for the vice president of new ventures upstream, after they were each on full pay and at home pending the outcome of the investigation.”

Furthermore, DA argued that the source of the financial disasters is the “ANC-appointed board”. To them, the board wasn’t fit to oversee the project because they don’t have the requisite skills.

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Adding that the board failed to punish the executives properly, DA said: “this trend seems to be continuing with the current impairment of R1.1 billion that will place a further liability on the SOE (State owned entity).”

Above all, DA charged that it will continue to strive for public money to be accounted for and the people involved in illegal and negligent activities punished.

“(We) will continue to push for a comprehensive turnaround plan from PetroSA, which should be backed by detailed research, and include action steps to ensure that the leadership is held accountable,” DA promised.