Anixas project grinds to standstill
Payment dispute causes ructions
A demand for N$30 million by one of the JV partners is holding up the finalisation of the project
Work has slowed significantly at the Anixas II power station construction site in Walvis Bay.
The station's purpose is primarily to support power supply in the Namibian grid. The site, which was once a hive of activity, now resembles a ghost town after an estimated 240 of 300 Namibian employees refused to continue construction due to non-payment and vacated the premises.
The remaining 60 employees onsite are employed by Telemenia and PHIM Investments.
A reliable source who preferred to remain anonymous explained that some companies removed their employees, while others - such as aggrieved Asbidud employees - downed their tools after not receiving their full salaries since December 2023.
“As for Asbidud employees, they were only assisted with ‘advances’ on their salaries from November. They only received a portion of their salaries and officials informed them the company had not been paid. They were told that they will receive their full salaries in February.”
The reason? According to the source, the payment issue apparently came about when a representative from one of the Namibian joint-venture (JV) partners allegedly demanded N$30 million in addition to the agreed amounts in the JV agreement.
"The demanding party threatened to interfere, interrupt and not cooperate with any of the requirements of the project should the JV not comply. The remaining members, being transparent, allegedly approached NamPower to advise on the situation. NamPower informed the Namibian company to cease its interference, demands and threats as this project is of national importance, especially considering the current state of South Africa’s power issues."
Regain control
However, the Namibian company reportedly refused to cooperate. "Subsequently, no payments were made to any employee, contractor or supplier since November or December. Payments that were made were made from the remaining committed JV members," the source said.
According to them, the JV is now attempting to remove the Namibian company from the agreement to regain control of this project and the financing thereof.
The overall construction of the 50 megawatt power station - valued at an estimated N$1.2 billion with a lifetime of 25 years and funded, owned and operated by NamPower - stands at 80%. The construction was initially scheduled for completion by the third quarter of last year. The contract between NamPower and the winning contractor - a JV comprising Telemenia (Israel), PHIM Investments and August 26 (both Namibian) - includes the engineering, procurement and construction of the project under a turnkey contract.
Best interests at heart
When approached for comment, NamPower corporate communications and marketing manager Tangeni Kambangula passed the buck to the contractor.
According to Telemenia CEO Amir Kurz, the JV partners and NamPower remain dedicated to the successful completion of Anixas II.
“As might happen in any major energy and infrastructure project, sometimes there are challenges, and this project is no exception. Any disputes existent within the project are being addressed per the contractual agreements as well as governing laws, ensuring that all actions are transparent, fair and aimed at the best outcomes for all involved.”
Kurz emphasised that their priority is the integrity and completion of the project, recognising its critical importance to Namibia's energy future.
“To this end, we are actively engaging in constructive dialogue and taking decisive steps to resolve any issues, always with the project's success and the community's best interests at heart. We are grateful for NamPower's continuous support and the understanding of all stakeholders as we work through these complexities. We look forward to keeping all parties informed on our progress and the successful realisation of this project.”
The station's purpose is primarily to support power supply in the Namibian grid. The site, which was once a hive of activity, now resembles a ghost town after an estimated 240 of 300 Namibian employees refused to continue construction due to non-payment and vacated the premises.
The remaining 60 employees onsite are employed by Telemenia and PHIM Investments.
A reliable source who preferred to remain anonymous explained that some companies removed their employees, while others - such as aggrieved Asbidud employees - downed their tools after not receiving their full salaries since December 2023.
“As for Asbidud employees, they were only assisted with ‘advances’ on their salaries from November. They only received a portion of their salaries and officials informed them the company had not been paid. They were told that they will receive their full salaries in February.”
The reason? According to the source, the payment issue apparently came about when a representative from one of the Namibian joint-venture (JV) partners allegedly demanded N$30 million in addition to the agreed amounts in the JV agreement.
"The demanding party threatened to interfere, interrupt and not cooperate with any of the requirements of the project should the JV not comply. The remaining members, being transparent, allegedly approached NamPower to advise on the situation. NamPower informed the Namibian company to cease its interference, demands and threats as this project is of national importance, especially considering the current state of South Africa’s power issues."
Regain control
However, the Namibian company reportedly refused to cooperate. "Subsequently, no payments were made to any employee, contractor or supplier since November or December. Payments that were made were made from the remaining committed JV members," the source said.
According to them, the JV is now attempting to remove the Namibian company from the agreement to regain control of this project and the financing thereof.
The overall construction of the 50 megawatt power station - valued at an estimated N$1.2 billion with a lifetime of 25 years and funded, owned and operated by NamPower - stands at 80%. The construction was initially scheduled for completion by the third quarter of last year. The contract between NamPower and the winning contractor - a JV comprising Telemenia (Israel), PHIM Investments and August 26 (both Namibian) - includes the engineering, procurement and construction of the project under a turnkey contract.
Best interests at heart
When approached for comment, NamPower corporate communications and marketing manager Tangeni Kambangula passed the buck to the contractor.
According to Telemenia CEO Amir Kurz, the JV partners and NamPower remain dedicated to the successful completion of Anixas II.
“As might happen in any major energy and infrastructure project, sometimes there are challenges, and this project is no exception. Any disputes existent within the project are being addressed per the contractual agreements as well as governing laws, ensuring that all actions are transparent, fair and aimed at the best outcomes for all involved.”
Kurz emphasised that their priority is the integrity and completion of the project, recognising its critical importance to Namibia's energy future.
“To this end, we are actively engaging in constructive dialogue and taking decisive steps to resolve any issues, always with the project's success and the community's best interests at heart. We are grateful for NamPower's continuous support and the understanding of all stakeholders as we work through these complexities. We look forward to keeping all parties informed on our progress and the successful realisation of this project.”
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