PetroSA chair vacates position on back of R1bn Oilgate 2 scandal

PetroSA chair Benny Mokaba has resigned following an energy department investigation into irregular spending. (M&G)

PetroSA chair Benny Mokaba has resigned following an energy department investigation into irregular spending. (M&G)

Mandla Tyala, spokesperson for the Central Energy Fund (CEF), which owns the company, said CEF chairperson Sankie Mthembi-Mahanyele announced Mokaba's departure on Monday morning.

"The move follows the conclusion of an investigation which was ordered by the minister of energy ... Dipuo Peters to investigate the robustness of the procurement system at PetroSA," Tyala said.

Mokaba's departure was effective immediately. Tyala could not confirm whether Mokaba chose to resign or was fired, nor could he confirm whether Mokaba was implicated in the report.

Mokaba's resignation may be linked to Friday's amaBhungane investigation which revealed that the parastatal's top management allegedly authorised around R200-million in irregular payments.

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Implicated in the irregular spending was acting chief executive Yekani Tenza, whose term at PetroSA ended last May; Everton September, the company's head of new oil and gas ventures; George Sabelo, a Johannesburg lawyer allegedly tied to some Zuma family members; and Tshepo Mahloele, a fund manager who featured in a Mail & Guardian exposé last year about the ANC benefiting from a bank empowerment deal.

Former PetroSA director Rain Zihlangu reportedly submitted three affidavits to police in November, asking for an investigation into the spending.

In one affidavit, he reportedly said: "Having been a board member of PetroSA since 2006, I had never encountered such blatant abuse of public funds and the flagrant flouting of all procurement policies as was done by Mr [Yekani] Tenza while he was the acting chief exectuive of PetroSA."

According to the amaBhungane investigation, potential liabilities amounting to R800-million had raised further questions about financial management during Tenza's tenure, which ended in May last year.

He and PetroSA's new oil and gas ventures head Everton September reportedly negotiated its acquisition of crude oil acreage in Ghana "in reverse", leading to around R162-million extra expenditure.

'Success fee'
After the deal was finalised, Johannesburg lawyer George Sabelo was paid a "success fee" of R11.4-million, a large portion of which was transferred to an unidentified third party, raising suspicions of corrupt dealings.

In a separate deal, PetroSA reportedly overspent on a secret deal to buy petrol stations nationwide.

Tenza allegedly fired transaction adviser HSBC, leading to a cancellation fee of R19-million, replacing it with the local firm Mahloele Harith Fund Managers.

Zihlangu likened Harith's appointment to placing a player "to simply kick the ball [through] empty goalposts", as HSBC had already identified a target company to acquire and done much preparatory work.

As a result, PetroSA had to pay a R19-million cancellation fee, which auditors have since recognised as "fruitless and wasteful".

Instead, the firm Harith Fund Managers was appointed for a 2.65% success fee, which would have earned Harith about R371-million, more than 10 times what HSBC would have earned.
In addition, it was to earn a monthly retainer of R1.3-million.

Furthermore, the appointment of Harith was made without any tender process. PetroSA chief of finance Nkosemntu Nika later complained that he had been "kept away" from this decision, which he said was "questionable".

After Tenza left, Harith's success fee was negotiated down to R187-million. – Additional reporting by Sapa

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