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SELCo threatens legal action

SELCo threatens legal action

THE Southern Electricity Company (SELCo) has threatened the Keetmanshoop Town Council with legal action to reverse its unilateral decision to terminate their controversial power supply contract.

According to the Keetmanshoop Municipality’s Chief Executive Officer, Jerry Shangadi, SELCo lawyers have written a letter demanding that the Town Council rescind its decision, failing which the company would apply for a High Court interdict. The South African electricity firm’s lawyers claimed that the local authority did not follow correct procedures in terminating the contract, Shangadi said.The lawyers had given the Town Council a deadline until yesterday to comply with the order, but Shangadi told The Namibian that the council did not intend to comply because the termination was prompted by a breach of contract on the part of SELCo.SELCo had stopped paying the Town Council royalties amounting to N$150 000 a month after the council rejected an electricity tariff hike proposed by SELCo, he said “During a previous meeting, SELCo noted that the Town Council would have to compensate for its losses after the rejection of the electricity tariff increase, thus the withdrawal of royalties must be a kind of punishment,” Shangadi said.He added that the Attorney General’s Office, which had been trying to renegotiate the power supply deal on behalf of the Town Council, was being kept informed of the latest developments.Attempts to get comment from SELCo proved futile.The Managing Director, Allan Van Zyl, could not be contacted.In 2000, the South African-controlled company acquired exclusive 15-year rights to run the electricity and water networks of almost all local authorities in the South.The deal was clinched after SELCo gave the Keetmanshoop Municipality N$5 million to upgrade the town’s electricity grid.The South African electricity firm’s lawyers claimed that the local authority did not follow correct procedures in terminating the contract, Shangadi said.The lawyers had given the Town Council a deadline until yesterday to comply with the order, but Shangadi told The Namibian that the council did not intend to comply because the termination was prompted by a breach of contract on the part of SELCo.SELCo had stopped paying the Town Council royalties amounting to N$150 000 a month after the council rejected an electricity tariff hike proposed by SELCo, he said “During a previous meeting, SELCo noted that the Town Council would have to compensate for its losses after the rejection of the electricity tariff increase, thus the withdrawal of royalties must be a kind of punishment,” Shangadi said.He added that the Attorney General’s Office, which had been trying to renegotiate the power supply deal on behalf of the Town Council, was being kept informed of the latest developments.Attempts to get comment from SELCo proved futile.The Managing Director, Allan Van Zyl, could not be contacted.In 2000, the South African-controlled company acquired exclusive 15-year rights to run the electricity and water networks of almost all local authorities in the South.The deal was clinched after SELCo gave the Keetmanshoop Municipality N$5 million to upgrade the town’s electricity grid.

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