The South African government has replaced the entire board of the South Africa Nuclear Energy Corporation (Necsa) following alleged failures in its statutory duties including legislative non-compliance, non-adherence to shareholder instructions, financial mismanagement and a failure to return the country’s radioisotope manufacturing facility to full functionality a year after it was shut down due to safety concerns.
A new board was approved by the South African cabinet on 5 December and was publicly announced by Energy Minister Jeff Radebe on 7 December. Rob Adam, who previously served as Necsa’s CEO for six years, has been appointed as chairperson. Don Robertson, who is a former managing director of Necsa subsidiary NTP Radioisotopes, has been made interim CEO replacing Phumzile Tshelane, who is on “precautionary suspension”.
Radebe said the Department of Energy had “for some time” been engaged with Necsa over “various serious challenges” that impacted the execution of the statutory nuclear technology organisation’s mandate. He said “continued ineptitude and deliberate acts of defiance” by some of the board members had resulted in setbacks and losses, including the non-production of medical isotopes for over a year by NTP, which he said the Necsa board had failed to resolve “when it was within their capacity to do so”.
Serious governance matters raised with board members include: “repetitive instances” of legislative non-compliance; non-adherence to specific shareholder instructions and/or directives; financial mismanagement; remuneration irregularities; unauthorised international travel; the issuing of misleading, inaccurate and/or defamatory media statements on a number of matters sensitive to the industry, Necsa itself and/or other relevant stakeholders; signing Memoranda of Understanding with foreign entities against the expressed instructions of the shareholder; numerous irregularities and concerns raised by the Auditor-General of South Africa during the 2017/18 audit process; and the board’s inability to ensure the return to full operational functionality of the NTP manufacturing facility.
“We are very confident that these new Board members will bring the kind of leadership stability and insight necessary and essential for the successful implementation of the Necsa Board’s institutional mandate, by restoring its credibility and integrity on governance matters. They bring along a wealth of diverse expertise and working experience, which will be pivotal in lifting Necsa from its current situation to a robust, functional and financially sustainable institution that is capable of meeting its statutory and institutional obligations,” Radebe and Deputy Minister Thembisile Majola said.
Necsa is a state-owned company responsible for undertaking and promoting RD in nuclear energy and radiation sciences. It is also responsible for processing source material, including uranium enrichment, and co-operating with other institutions, locally and abroad, on nuclear and related matters. Its main activities include the operation and utilisation of the Safari-1 research reactor at Pelindaba. It also manages and operates the Vaalputs National Radioactive Waste Disposal Facility in the Northern Cape on behalf of the National Radioactive Waste Disposal Institute.
NTP produces and distributes molybdenum-99 (Mo-99) and radioisotope-based diagnostic imaging and therapy products including iodine-131 and lutetium-177. The company had previously been one of the four major global suppliers of the short-lived Mo-99, which is the world’s most widely used medical isotope. Radioisotope production was effectively suspended from November 2017 on the orders of South Africa‘s National Nuclear Regulator (NNR), after NTP reported the discovery of procedural deviations related to a set of standard operating protocols. Reduced production runs restarted in late February 2018, but the plant was shut down again in May after additional “safety-related incidents”. The NNR in November gave NTP permission to resume production.