Tanzanian Association Oslo

Richmond contract negotiations:

Who was involved?

THISDAY REPORTER
Dar es Salaam

AS parliament gets set to initiate its own investigation into the 172.9bn/- Richmond power generation deal, new details have emerged about the individuals involved in the negotiations leading up to the controversial deal mid-last year.

According to THISDAY’s latest findings, a total of 17 officials from both sides (the government and Richmond Development Company) participated in the contract negotiations conducted in Dar es Salaam between June 8 to 15 last year.

Members of the government negotiation team were drawn from the Ministry of Finance, Bank of Tanzania, Ministry of Energy and Minerals, attorney general’s chambers and the Tanzania Electric Supply Company Limited (TANESCO).

Minutes of the official contract negotiations, as seen by THISDAY, show that the government team was chaired by Singi Madata, assistant commissioner for debt policy in the Ministry of Finance.

Among other things, the government team was given the mandate of negotiating the technical, commercial and legal aspects of the contract.

The government negotiation team under Madata, who was recently appointed board chairman of the state-run Rural Energy Agency (REA), has now come under the spotlight over its bizarre decision to pick Richmond for the contract to generate 100MW of turbine-powered electricity into the national grid.

The state-run Public Procurement Regulatory Authority (PPRA) has said in a still-fresh report that there was remarkable ’political influence’ and interference by ’higher authorities’ in government in the awarding of the tender to Richmond.

Other government officials who took part in the week-long contract negotiations included Theophillo Bwakea, assistant commissioner for electricity in the Ministry of Energy and Minerals, and Dick Thewa from the Bank of Tanzania (BoT).

Also in the contract negotiations were Julius Sarota from the Ministry of Energy and Minerals, and Donald Chodawu, a state attorney with the AG’s chambers.

Representing TANESCO in the talks were Stephen Mabada, Mohamed Saleh, Godson Makia, James Mtei and Wangwe Mwita.

The Richmond delegation, led by the company’s director Mohamed Gire, also included Naeem Gire, Gary Borges and Cuthbert Tenga (lawyer).

Minutes of the meetings also list Gideon Nasari from the Confederation of Tanzania Industries (CTI) as a participant in the negotiations.

Government experts in the contract negotiation process were given the mandate to review bids from eight companies - Real Energy (UK), Aggreko International (UAE), Richmond Development Company LLC (USA), Renco SPA (Italy), APGUM Company Limited (Germany), Globeleq Limited (UK), GAPCO (Tanzania) Limited and QUANTUS of Germany.

According to the PPRA findings, TANESCO had initially identified two bidders out of the short-listed eight - Renco SPA and Real Energy - as relatively more responsive to the bid requirements than Richmond Development Company.

But in a surprise move, the government negotiation team went ahead and picked Richmond without conducting a due diligence on the company, and despite TANESCO having already rejected the company as being incompetent.

Impeccable sources have told THISDAY that the government team made the decision under pressure from at least one senior government official.

On Tuesday this week, the National Assembly voted overwhelmingly in favour of a proposal by the Parliamentary investments and trade committee for the formation of a probe committee to re-investigate the Richmond deal.

To this effect, Parliamentary speaker Samuel Sitta appointed legislators Dr Harrison Mwakyembe (Kyela-CCM), Lucas Selelii (Nzega-CCM), Herbert Mntangi (Muheza-CCM), Stella Manyanya (Special Seats-CCM) and Mohamed Mnyaa (Mkanyageni-CUF) to constitute the probe team.

Tabling a scathing report in the House, the chairman of the parliamentary investments and trade committee, William Shellukindo, said there was a need to re-investigate the Richmond deal after the Prevention and Combating of Corruption Bureau (PCCB) had controversially cleared the transaction.

In the ensuing debate, several MPs quoted the PPRA report as saying that key contractual issues protecting TANESCO as the client were ignored during the contract negotiations, and the power utility’s chief legal advisor did not even know who drafted the contract or what was in it.

The government’s procurement watchdog also stated in its report that the Richmond deal was signed ’’under strange circumstances at night.’’