Rosatom nuclear deal

In 2014, South Africa’s energy minister signed a preliminary inter-governmental agreement with Rosatom, Russia’s state nuclear corporation, for the procurement of 9,600 megawatts of nuclear energy capacity. The estimated cost of the full nuclear build programme was R1–1.3 trillion (~$76–100bn) — the largest single government commitment in South African history. The deal was personally championed by President Jacob Zuma and became the trigger for one of the most consequential acts of executive abuse in the state capture era.

Nene firing (December 2015): At a summit in Russia, Finance Minister Nhlanhla Nene refused to sign a financial guarantee that Zuma wanted to present to President Vladimir Putin, telling the inquiry later that the “costs associated with [the deal] are astronomical.” Zuma became “hostile.” On 9 December 2015, Nene was abruptly fired — replaced by an unknown backbencher, Des van Rooyen. The Rand crashed immediately; investor confidence evaporated. Under intense market and political pressure, Zuma recalled Pravin Gordhan (his own prior Finance Minister) within four days. Nene later confirmed under oath before the Zondo Commission that he believed he was fired specifically for blocking the nuclear deal (and for refusing to approve a loss-making SAA route to Khartoum). The Treasury “Nine Days” became a defining exhibit of how Zuma used presidential power for personal and transactional ends.

Gupta benefit: The Gupta Family had purchased Shiva Uranium Mine from Uranium One (a Rosatom subsidiary) in 2010. A successful nuclear build programme would have made South Africa a major uranium consumer, potentially channelling supply contracts through Shiva. The Irish Times noted the commercial logic: “the Guptas stood to benefit from this deal through their 2010 purchase of South Africa’s Shiva uranium mine from Uranium One, a Rosatom subsidiary, if it became a supplier of the metal to newly built nuclear power stations.”

Court defeat (2017): The Western Cape High Court ruled in April 2017 that the nuclear procurement process — initiated via the inter-governmental agreement — was unlawful, as it had bypassed the required National Treasury and Parliamentary processes. This effectively killed the Zuma-era nuclear programme. The ruling was obtained through a legal challenge by Earthlife Africa and the Southern African Faith Communities’ Environment Institute.

Connections

• Jacob Zuma — personally championed the deal; fired Nene for refusing to guarantee it; Zondo testimony confirmed under oath; the “Nenegate” firing is Zuma’s most economically damaging single act
• Gupta Family — Shiva Uranium Mine; Guptas stood to benefit as uranium supplier to any Rosatom-built plants; nuclear deal as another Gupta extraction pipeline
• Eskom — nuclear capacity was to supplement/replace coal; Eskom was the intended operator; Eskom’s board capture under Gupta era was related to this energy policy constellation
• National Prosecuting Authority (NPA) — no criminal charges for the nuclear deal itself; Nene’s testimony at Zondo Commission is the primary accountability record
• Zondo Commission — Nene’s October 2018 testimony about the nuclear deal and his firing is Vol 5 material; landmark public account of how Zuma exercised corrupt executive authority
• Cyril Ramaphosa — Ramaphosa-era energy policy abandoned nuclear in favour of renewable energy procurement; the nuclear IRP capacity was removed from the updated Integrated Resource Plan

Sources

• Newsweek: South Africa court rules against Russian nuclear deal (2017)
• Reuters: SA’s Zuma fired me for blocking Russian nuclear power deal — Nene (2018)
• Standard Media: Nene — I was fired by Zuma for blocking nuclear deal
• Irish Times: SA finance minister claims he was fired for not signing nuclear deal (2018)