Roy Cokayne
The energy solutions business of engineering company Group Five has developed a nuclear capability to position it to benefit from the government’s planned nuclear programme.
Group Five is also aiming to diversify the assets in its investments and concessions cluster and expand its footprint beyond only toll roads.
Willie Zeelie, Group Five’s executive for its engineering and construction cluster, said this week the group’s executive had taken a decision that it needed to prepare itself for nuclear power should it happen, although it had not yet made a final decision about progressing to nuclear power.
“We do expect that will happen in the first quarter of next year. The nuclear build we believe is coming,” he said.
Zeelie added that as part of its preparation, it had in June acquired a stake in Lesedi Nuclear Services, which services the Koeberg nuclear power plant. Lesedi is a subsidiary of French nuclear giant Areva.
It had also established a Group Five nuclear services business to make sure it learnt how to work under nuclear conditions in terms of the quality, safety, procedural requirements and construction methodologies that were required.
Zeelie said Eskom had issued some bids, such as the steam generator replacement project and PTR tank replacement bid, and three tenders were issued last week for “post-Fukushima upgrades”, which were under evaluation.
This is a reference to the Fukushima nuclear power plant in Japan that was destroyed last year by a tsunami.
Zeelie said Group Five would not have been able to compete for this work had it not started this process.
“I think we are ahead of the competition in this phase of the work. The big carrot is the Eskom nuclear build when that gets announced,” he said.
Meanwhile, Eric Vemer, the Group Five executive for investment and concessions, said 90 percent of the cluster’s revenue currently came from toll road concession projects.
Vemer said Poland was a very big part of the business, accounting for in excess of 50 percent of the profits in its Intertoll Group. But Vemer expected this to decline because it was becoming more optimistic about new projects in Africa and eastern Europe from 2015 onwards.
He said the South African market was frustrating and typified by inconsistent and politically misaligned opposition to projects across most infrastructure sectors with the exception of renewable energy.
Vemer said a different story was emerging for the rest of Africa. It had proven success in a project worth R1.4 billion in Zimbabwe and was busy on further phases related to this.
Group Five shares closed 0.1 percent lower at R25.