Corporate activity at an international level has resulted in the disappearance of Hitachi Power Africa (HPA), which was controversially associated with the African National Congress’s Chancellor House, and the emergence of Mitsubishi Hitachi Power Systems Africa (MHPSA), which was formally launched at the beginning of March.

The 400-employee business assumes responsibility for the boiler contracts at Eskom’s Medupi and Kusile coal-fired power projects, which are also the largest and most complex currently being undertaken globally by the larger Mitsubishi Hitachi Power Systems joint venture, which is domiciled in Yokohama, Japan.

The international merger of the thermal power units of Mitsubishi Heavy Industries (MHI) and Hitachi was announced in late 2012, but was formally launched in February, with MHI holding a 65% interest and Hitachi the 35% balance. The joint venture's revenues were R124-billion last year.

Newly appointed CEO Stephen Moore (42) describes the creation of MHPSA as the start of a “new era” for the African unit, which has been mired in controversy ever since it emerged that Chancellor House was a 25% shareholder in HPA.

Prior to the official launch of MHPSA, Hitachi acquired Chancellor House’s stake, as well as the 5% interest held by Makotulo Investments & Services, and was given a six-month grace period by Eskom to recover its black-economic empowerment (BEE) status.

Having a BEE shareholding remains a condition for the R38.5-billion Medupi and Kusile boiler contracts, which were awarded to HPA and Hitachi Power Europe in 2007.

Moore told Engineering News Online that it was weighing various empowerment options and had been inundated with expressions of interest ever since the acquisition of the previous BEE interests was confirmed in late February.

No decision had yet been made, but Moore was confident of consummating a deal within the six-month timeframe stipulated.

The Zambian–born, British national also insisted that the company remained committed to South Africa and to growing its footprint both inside the country and in the rest of Africa, noting that the joint venture’s global CEO and president, Takato Nishizawa, had personally presided over the launch of MHPSA in early March. The Competition Commission approved the merger on November 20, 2013.

Nishizawa had also met with Eskom during his visit, during which he reaffirmed the importance of the Medupi and Kusile contracts to the newly created group.

Moore said the African unit was particularly keen to participate in the possible modernisation of Eskom’s existing coal-fired fleet, was also targeting gas and coal opportunities in Mozambique and Botswana, while also delivering on geothermal projects in Kenya.

But the immediate priority remained the Medupi and Kusile contracts, where Moore said good progress had been made in dealing with weld defects on Medupi Unit 6. He said it was in a position to meet Eskom’s commissioning schedule of the second half of the year for the first Medupi unit.

A new implementation model had also been implemented at Kusile in response to the problems experienced at Medupi and would be rolled out to units one, two, three and four at Medupi in due course.

The Japanese parent company, which has appropriately adopted the motto ‘never give up’, had also decided to commit additional senior resources to the two projects, with teams due to arrive in South Africa in April to be introduced at the Medupi and Kusile sites.

MHPSA has also unveiled its new management team, which besides Moore comprises CFO Bjoern Lahm, chief corporate officer Bongani Mthembu and chief operations officer Thomas Brown.