News / National
Zesa is not going to pay US$22 million to Wicknell Chivayo
01 Dec 2023 at 11:24hrs | Views
Zimbabwe's power utility Zesa says it is not going to pay US$22 million to flamboyant business tycoon Wicknell Chivayo as reported, but instead his company Intratrek Zimbabwe (Pvt) Ltd has to fund the now court-reinstated US$172 million Gwanda Solar Power Station Project.
The Supreme Court today delivered a judgement on the appeal by the Zimbabwe Power Company (ZPC) against a High Court decision which had found that the contract for the development of the 100MW
Gwanda solar project was still valid.
The situation followed ZPC's cancellation of the deal.
The power utility says even if it lost again today, that does not create any liability for it.
ZPC's appeal was dismissed today after a hearing before Justices George Chiweshe, Lavender Makoni and Joseph Musakwa.
The full written judgement with reasons is yet to be furnished.
In the aftermath of the High Court judgement reinstating the deal, and now confirmed by the Supreme Court decision, there has been confusion on what this means.
Some said it meant Zesa would now have to pay Chivayo US$22 million.
However, Zesa, through its subsidiary ZPC, says effectively the judgement means things have been restored to their original setting and Chivayo's company must now facilitate raising US$172 million to fund project within the agreed time-frame.
"The Supreme Court judgement has the effect of upholding the High Court judgement granted by Honourable Justice (Siyabonga) Msithu in January 2023, in which the Gwanda EPC Contract was found to be still valid and binding on both ZPC and Intratrek Zimbabwe (Private) Limited," ZPC said.
"For the avoidance of doubt, the High Court judgement did not award Intratrek damages in the sum of US$22 million as alleged by some online publications or any other sum in damages for that matter. To the contrary, the High Court only granted an order for specific performance, which in simple terms requires parties to perform their respective obligations under the EPC contract.
"Considering that the Supreme Court is the final court of appeal in this instance, the legal implication of today's judgment is that ZPC and Intratrek will revert to the position that they were before the 23rd April 2018 when the EPC Contract was cancelled.
"In abiding with the Supreme Court judgement, Intratrek is now required under the reinstated EPC Contract to facilitate the financing of the US$172 million contract within the contractual timeframe as the requirement of financial closure is key for the project to commence. Should such financing be raised, the borrowing instruments must be approved by government prior to implementation of the project."
The Supreme Court today delivered a judgement on the appeal by the Zimbabwe Power Company (ZPC) against a High Court decision which had found that the contract for the development of the 100MW
Gwanda solar project was still valid.
The situation followed ZPC's cancellation of the deal.
The power utility says even if it lost again today, that does not create any liability for it.
ZPC's appeal was dismissed today after a hearing before Justices George Chiweshe, Lavender Makoni and Joseph Musakwa.
The full written judgement with reasons is yet to be furnished.
In the aftermath of the High Court judgement reinstating the deal, and now confirmed by the Supreme Court decision, there has been confusion on what this means.
Some said it meant Zesa would now have to pay Chivayo US$22 million.
However, Zesa, through its subsidiary ZPC, says effectively the judgement means things have been restored to their original setting and Chivayo's company must now facilitate raising US$172 million to fund project within the agreed time-frame.
"The Supreme Court judgement has the effect of upholding the High Court judgement granted by Honourable Justice (Siyabonga) Msithu in January 2023, in which the Gwanda EPC Contract was found to be still valid and binding on both ZPC and Intratrek Zimbabwe (Private) Limited," ZPC said.
"For the avoidance of doubt, the High Court judgement did not award Intratrek damages in the sum of US$22 million as alleged by some online publications or any other sum in damages for that matter. To the contrary, the High Court only granted an order for specific performance, which in simple terms requires parties to perform their respective obligations under the EPC contract.
"Considering that the Supreme Court is the final court of appeal in this instance, the legal implication of today's judgment is that ZPC and Intratrek will revert to the position that they were before the 23rd April 2018 when the EPC Contract was cancelled.
"In abiding with the Supreme Court judgement, Intratrek is now required under the reinstated EPC Contract to facilitate the financing of the US$172 million contract within the contractual timeframe as the requirement of financial closure is key for the project to commence. Should such financing be raised, the borrowing instruments must be approved by government prior to implementation of the project."
Source - newshawks
