News | NEC Contracts

Most NEC clients in South Africa are those working on an ongoing portfolio of projects, the most notable being the continued expansion of the University of Mpumalanga in Nelspruit, Mpumalanga Province. Together with Sol Plaatje University in Kimberley, Norther Cape Province, a further R5 billion (£280 million) of additional facilities is planned to be delivered under NEC contracts at these two new NEC procured universities over the next 5 years.

Eskom, the national electricity supplier, has recently issued tenders under the NEC3 Term Service Contract for the provision of maintenance and outage repair services for boiler pressure parts and high-pressure pipework at various power stations. This contract is likely to be worth several billion rand in value and for a service period of around four years. However, the South African engineering and construction industry is currently in a major recession, with the government short of money and most of the government owned entities making substantial losses and surviving only from state bailouts. These entities mainly use NEC for their procurement.

Providing best outcomes

Nevertheless, there are some major capital works on the horizon and the local NEC fraternity will be making every effort to ensure the collaborative style of NEC contracts provides best outcomes for these projects.

For example, the country’s updated Integrated Resource Plan 2018 was published in consultative form in August last year. This multi-billion rand electricity infrastructure development plan includes construction of new infrastructure as well as the maintenance and repair of existing infrastructure. It could provide much-needed relief for the industry in the long term provided it is approached and implemented responsibly.

Furthermore, president Cyril Ramaphosa has recently embarked on a drive targeting US$100 billion inward investment over the next five years, including hosting a successful international investment conference in September last year.

NEC South Africa Users’ Group

In the meantime, plans are still progressing for the establishment of a South African branch of the NEC Users’ Group. This membership-based support service for local users will be led through the NEC UK office by Cheryl Waterman.