Sabalele village, in Cofimvaba, a town in South Africa’s Eastern Cape, boasts a brand new tar road off the N6 between Queenstown and East London. On the side lies an unoccupied house on a hill with peeling cream paint. The small brick house has a yard half the size of a football field; a huge family gravestone stands next to the wire fence. A pita toilet is on the one side and a disused kraal on the other; the sun-dried grass reaches your knees.
<div id="attachment_31412" style="width: 695px" class="wp-caption alignnone"><img loading="lazy" decoding="async" aria-describedby="caption-attachment-31412" class="wp-image-31412 size-large" src="http://www.forbesafrica.com/app/uploads/2017/06/Chris-Hani-008-685x1024.jpg" alt="" width="685" height="1024" srcset="https://cms.forbesafrica.com/wp-content/uploads/2017/06/Chris-Hani-008.jpg 685w, https://cms.forbesafrica.com/wp-content/uploads/2017/06/Chris-Hani-008-300x448.jpg 300w, https://cms.forbesafrica.com/wp-content/uploads/2017/06/Chris-Hani-008-600x897.jpg 600w, https://cms.forbesafrica.com/wp-content/uploads/2017/06/Chris-Hani-008-201x300.jpg 201w" sizes="(max-width: 685px) 100vw, 685px" />Statue of Chris Hani outside the community centre</div>
Inside, the only remnants that show people once lived here are a coffee table draped in white cloth, old broken red sofas, and two photographs hanging on opposite walls of the dining room. One is of martyr Chris Hani and the other of his parents Gilbert and Nomayise. It’s an understated memorial for one of the best known names in African politics. Often, it doesn’t see a soul for six months at a time.
<div id="attachment_31363" style="width: 695px" class="wp-caption aligncenter"><img loading="lazy" decoding="async" aria-describedby="caption-attachment-31363" class="wp-image-31363 size-large" src="http://www.forbesafrica.com/app/uploads/2017/05/Chris-Hani-003-685x1024.jpg" alt="" width="685" height="1024" srcset="https://cms.forbesafrica.com/wp-content/uploads/2017/05/Chris-Hani-003.jpg 685w, https://cms.forbesafrica.com/wp-content/uploads/2017/05/Chris-Hani-003-300x448.jpg 300w, https://cms.forbesafrica.com/wp-content/uploads/2017/05/Chris-Hani-003-600x897.jpg 600w, https://cms.forbesafrica.com/wp-content/uploads/2017/05/Chris-Hani-003-201x300.jpg 201w, https://cms.forbesafrica.com/wp-content/uploads/2017/05/Chris-Hani-003-768x1148.jpg 768w" sizes="(max-width: 685px) 100vw, 685px" />Lungile Gongqa</div>
This was the home Hani and his five siblings grew up in. His father died in 1994 and mother in 2000; both were buried by the wire fence and eventually the entire family moved out.
On this cold Saturday morning in April, the month Hani was gunned down 24 years ago on the driveway of his house in Boksburg, Johannesburg, hundreds of people gathered in Sabalele village to commemorate him; not with a rally or church service but with sweat and striving in the annual Chris Hani Freedom Marathon.
This five-year-old race, a community hall with a bronze statue, and a district municipality named after him are a few things the municipality has to keep Hani’s name from oblivion. The old and young, who never got a chance to know Hani, came to walk and run the path to his Catholic school.
“You must be very strong to run this one, this is a tough course, it’s gravel. Can you imagine a young Chris Hani walking here every day of his schooling,” says Enoch Skosana, the race official and marathon winner.
Skosana says the run is symbolic of how Hani carried his country on his shoulders in later life. With the African National Congress’ (ANC) armed wing, uMkhonto we Sizwe, Hani commanded thousands of soldiers with the same zest, he says. The retired Skosana won several half marathons before forming a development club supported by his former team, Nedbank Running Club, in Gauteng.
“To me, as a councillor and politician, this event is a milestone. Chris Hani himself never entered the Canaan he fought before he died in the hands of apartheid defenders. Chris Hani District Municipality is proud of the whole commemoration of its son. In my view I would like to have a running club established here, so that we can have more long distance runners who are putting this district on the map,” says Wanda Vani, a ward councillor for 23 villages around Sabalele.
Vani says despite a small development in the Sabalele, many villages do not have tar, nor running water. He also laments high unemployment of youth – the race only provides jobs for a few.
The 25-kilometer marathon honoring Hani may be among the smallest on the calendar of Athletics South Africa (ASA) but it has been growing in stature and created at least one Olympic athlete. Lungile Gongqa was the 2017 Two Oceans Marathon winner in Cape Town. He came through the ranks of this dusty village, near where he grew up in Ngcobo. When it started in 2012, Gongqa was the first winner. He went on to represent his country at the 2016 Rio Olympics but didn’t finish because of a hamstring injury.
<div id="attachment_31364" style="width: 778px" class="wp-caption alignnone"><img loading="lazy" decoding="async" aria-describedby="caption-attachment-31364" class="wp-image-31364 size-full" src="http://www.forbesafrica.com/app/uploads/2017/05/Chris-Hani-010.jpg" alt="" width="768" height="514" srcset="https://cms.forbesafrica.com/wp-content/uploads/2017/05/Chris-Hani-010.jpg 768w, https://cms.forbesafrica.com/wp-content/uploads/2017/05/Chris-Hani-010-300x201.jpg 300w, https://cms.forbesafrica.com/wp-content/uploads/2017/05/Chris-Hani-010-600x402.jpg 600w" sizes="(max-width: 768px) 100vw, 768px" />Athletes before the 25 kilometer race</div>
“In my first running competition I was excited to take home a t-shirt and a roll-on as my prize. I was only 18 years old at the time. I knew my parents would be grateful for that. But things got better when I won this Chris Hani race in 2012, the prize was R7,500 (around $550). I was not a member of any club, so that meant I had to train by myself and pay my own transport. This is one of the reasons I have approached the municipality with the idea to coach the up-and-coming runners in the district. I didn’t finish school but I can make a living from the sport,” says Gongqa.
Gongqa, who runs for Nedbank Running Club in Cape Town and travels between there and the Eastern Cape, won R250,000 ($18,500) at the Two Oceans Marathon.  Gongqa, who flew from Cape Town to support the race in Sabalele village, believes there are many more Olympians to unearth here.
Inspiration could be taken from Lusapho April, a long distance runner from Uitenhage, Eastern Cape, who was a new entrant in the Hani race. He represented his country at the 2012 London Olympics and 2016 Rio Olympics, and finished third in the New York City Marathon in 2013. April holds the record of winning the Hannover Marathon, in Germany, for three consecutive years between 2011 and 2013.
<div id="attachment_31367" style="width: 860px" class="wp-caption alignnone"><img loading="lazy" decoding="async" aria-describedby="caption-attachment-31367" class="wp-image-31367 size-full" src="http://www.forbesafrica.com/app/uploads/2017/05/Chris-Hani-111.jpg" alt="" width="850" height="569" srcset="https://cms.forbesafrica.com/wp-content/uploads/2017/05/Chris-Hani-111.jpg 850w, https://cms.forbesafrica.com/wp-content/uploads/2017/05/Chris-Hani-111-300x201.jpg 300w, https://cms.forbesafrica.com/wp-content/uploads/2017/05/Chris-Hani-111-600x402.jpg 600w, https://cms.forbesafrica.com/wp-content/uploads/2017/05/Chris-Hani-111-768x514.jpg 768w" sizes="(max-width: 850px) 100vw, 850px" />Small brick house,Sabalele village, in Cofimvaba</div>
“Being here is just to honor the man for what he did for the country. And also I never run in these conditions in the village, I just wanted to partake to encourage the future athletes from around here. It’s not every day you see someone who has been to the Olympic Games coming back to run here. I was humbled to see some local boys running with torn shoes and soccer boots, they showed me that there’s so much hunger to achieve their dreams,” he says after finishing the race in second spot and with a limp.
Both April and Gongqa were chuffed to see hundreds of school children running alongside their parents. Just like young Gongqa, the unlikely young competitors were ecstatic to walk home with their new oversized white-shirts and medals, even if there was no roll-on.
Hani would have been proud.

SACP-CHRIS HANI

Running For A Hero

For decades, Dan Qeqe Stadium, in the dusty Zwide township of Port Elizabeth in the Eastern Cape, was a bedrock of black rugby and home to African Bombers, a former first-tier club. It nurtured a handful of professionals, including Springboks Akona Ndungane and Siya Kolisi. The two were among the few blacks to represent their country and earn big money.
<div id="attachment_5060" style="width: 310px" class="wp-caption alignleft"><img loading="lazy" decoding="async" aria-describedby="caption-attachment-5060" class="size-medium wp-image-5060" src="/wp-content/uploads/2017/05/GettyImages-119660385-300x181.jpg" alt="" width="300" height="181" />PRETORIA, SOUTH AFRICA &#8211; JULY 23: Akona Ndungane of Bulls scores during the Absa Currie Cup match between Vodacom Blue Bulls and Toyota Free State Cheetahs at Loftus Versfeld on July 23, 2011 in Pretoria, South Africa (Photo by Lee Warren/ Gallo Images/Getty Images)</div>
These days Dan Qeqe is a rundown shadow of itself. The changing rooms are dilapidated and the pitch is baked hard with patches of red grass. Despite the dire condition, without fail, every winter hundreds of boys tackle each other on this pitch; the hope of becoming a Springbok lives on. As a young lad, I donned my oversized hand-me-down rugby jersey and threw my body into the tussle for the oval ball. We stomped the pitch, barefoot, until we were hardened veterans at 17. In 15 years I covered every inch and cut my knees open every week.
Fifty kilometers north of Dan Qeqe Stadium is the Nelson Mandela Bay Stadium, a state-of-the-art facility built for the football World Cup in 2010. It is home to Eastern Province Rugby Union (EPRU). In the hot days of summer, just before Christmas, this was the scene of a battle for the soul of grassroots African rugby. It was where managers from over 100 clubs fought their provincial bosses. It was so bad that a scuffle broke out and the security manhandled the angry.
It is part of a struggle to bring hope to black rugby in one of Africa’s hotbeds of the game. The problems run deep at EPRU. For years, there’s been no sponsorship due to lack of accountability; for months players weren’t paid and their reputable coach Carlos Spencer resigned; black players left in droves under claims of financial discrimination and the controversial signing of eight white players, compared to one black player, for the 2016 Super Rugby season.
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Bantwini Matika, the coach of the rugby club Young Collegians and a chairman of a national lobby group Rugby Transformation Coalition, led the fight.
“We have identified these problems for years and followed the due process but without any reward. Now we have seen a collapse of the whole system. Financially, never before has EP Rugby been so in the red. It’s a crisis of unprecedented proportions,” says Matika.
The clubs demanded accountability and a change of management in the provincial structure. At the top of the agenda was the non-payment of EP Kings – the provincial players.
“We are in a serious crisis in the Eastern Cape. This is the home of black rugby. The only reason we got the Super Rugby franchise was solely because Saru (the South African Rugby Union) wanted to create a platform for black players to showcase their talent to the world and for Springbok selection. This has been in the plans of Saru since time immemorial that we need a platform for black players and then the franchise was ideal… Unfortunately the Eastern Cape, which is Border and Eastern Province, has always been unstable because of a lack of resources and lack of sponsors, no solid administrators,” says Matika.
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Since 2014, EPRU has not held a quarterly meeting nor AGM. Matika says, besides the annual grant from Saru, EPRU cannot attract sponsorship because there’s no financial accountability.
“That’s a recipe for disaster. We have talent in abundance (but) our system and administration is not in place. If we don’t have ethical and decisive leadership, if we don’t have proper resources to create an enabling environment for our young people to prosper, we are doomed to fail. Hence you see them running to other unions at a young age. The rot is within the administration,” says Matika.
Mervin Green is Saru’s general manager in strategic performance. He says EPRU made it difficult for Saru to support them in running the business.
“Saru does not interfere with union’s domestic affairs, such as clubs and schools development. We support unions with finances and expertise to ensure they deliver on their own development programs. It is indeed not an ideal situation for everyone what is currently happening at EPRU. However, it is only the clubs that can change the situation,” says Green.
Transformation Rugby Coalition was launched in Soweto, Johannesburg, in 2012. Matika, the former University of Fort Hare captain and coach, was its founding chairman. He laments the lack of transformation in the Springboks.
“After realizing that all the agreements around transformation, whether it is through charters or Saru development plans since 2000, every three years we have a new document that is fruitless. All the rugby activists and (concerned) managers nationwide decided to launch this national structure in 2013 in Soweto. I am glad now we are speaking with one voice and seem to be making a difference and the approach is working for us.”
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A few months before the 2015 Rugby World Cup in England, calls were made not to send the Springboks because they didn’t have enough black players. Political party, Agency for New Agenda, made a court bid to block the team from leaving. They lost the case. This followed Saru’s climb down from the 50% black Springbok representation by 2015, they moved it to 2019. The move did not go down well with Transformation Rugby Coalition.
“The disappointing factor is that we are not getting a hearing. We speak and we write to Saru but they are not interested in what we saying. At the personal and individual capacity, Saru President Oregan Hoskins would respond with promises but there’s nothing happening, nor do we get any recognition from Sascoc (South African Sports Confederation and Olympic Committee). We would expect that as a lobby group we should have a budget from government but we are currently sustaining ourselves from our own pockets,” says Matika.
The African dream of playing professional rugby reaches far beyond the Eastern Cape. It’s mid-January, a thousand kilometers north of Dan Qeqe stadium. About 40 barefoot boys, aged between nine and 13, are taken through their paces on a rugby field in Braamfischerville, at the Soweto Rugby Club. Their coach is 35-year-old, chubby and outspoken, Zola Ntlokoma.
“We don’t only create rugby players here, we encourage discipline and we want them to pass with good marks. If you don’t go to school, we have no business with you,” Ntlokoma tells me.
Like his counterpart, Matika in Port Elizabeth, Ntlokoma decries the lack of support for grassroots rugby and asserts that he will transform Braamfischerville into a rugby hotbed. Soweto is a football area with three clubs in the Premier Soccer League.
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“Out of 49 townships there’s none with a junior team anymore after [the Golden] Lions Rugby Union took over development and government pumped money to them to champion development. But the money is not filtered down to grassroots where it is needed most. Hence we were forced by those circumstances to form Soweto Rugby Union. It’s not a racial thing, it is just we are tired of complaining. We won’t beg someone to play rugby, we love rugby,” he says.
Ntlokoma, who is also the secretary of Transformation Rugby Coalition, says in the 1990s Soweto Rugby Club dominated the Golden Lions Rugby junior teams with star player Stanley Mlotshwa representing the junior national team in 1998. The last was Malungisa Nkosi, who played for the under-19s in the World Championships in 2006, in Dubai.
Transformation Rugby Coalition researched why black players were not as involved in South African rugby as they should be.
“We discovered that rugby is not run as it is portrayed in the media. There’s a lot that our government doesn’t understand about how rugby runs. We felt that this is a mafia-like organization. It is held to ransom by businesspeople in Stellenbosch who are controlling the executive of Saru, telling them this is the direction they must take. It is that rich white group that decides who is going to be the president of Saru and the coach of the Springboks,” says Ntlokoma.
“Englishmen introduced rugby in South Africa, not the Afrikaners. Now should we give up and say it is the Afrikaners’ sport, I don’t think we will be doing justice to back off. It is a South African sport, that’s why we should continue embracing it. Some of us still hate the Springbok emblem because it reminds us of apartheid… I was a gangster and this sport gave me a second chance in life. Rugby, like any other sport, it changes people’s lives,” he says.
Liz McGregor, a rugby writer based in Cape Town, says Saru has enough money to expedite transformation. She’s sceptical about the target of 50% black representation in 2019.
“If our promising young black players are not being given regular game time at this level now, the next target – 50% of black Springboks by 2019 – also looks like a chimera. I have heard complaints about marginalization from black players for years, at provincial and national level. If the strategic transformation plan were effective, marginalization should be a thing of the past,” she says.
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McGregor raises concerns about Hoskins’ silence about the failure to hit targets in the Springbok teams.
“Grassroots development will always be a key strategic imperative of Saru. The current strategic transformation plan emphasizes the importance of this transformation dimension. We are actively involved in all unions to ensure we provide access to the game and particularly focusing on schools where there was no rugby before,” counters Green.
Green says Saru’s recruitment drive in 2015 saw 80,000 new players from over 300 schools around South Africa.
“The program for participation will be extended to high schools this year and we hope to reach township and rural schools to be in organized leagues. Our focus is also on capacitation programs of thousands of teachers and volunteers as certificated coaches, match officials and administrators,” says Green.
Clearly there are not enough to help more black Africans play the sport.
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Is A White Mafia Trampling  Black Dreams?

It was tough on a lonely farm in the tiny town of Molteno in South Africa’s Eastern Cape in 1940. The world was at war and South Africa was staggering from the great depression.
On this windswept property, the farmer’s wife had an idea to make money for her family. Elizabeth Anne Greyvensteyn wanted to bake biscuits to sell to her friends at church and on neighboring farms. The only problem was she didn’t have any money to convert her barn into a bakery.
So the farmer’s wife sought a £1,500 loan from a new unknown government agency. Three quarters of a century later both lender and lendee are household names.
The loan to the farm near Molteno was the first issued by the Industrial Development Corporation (IDC) that celebrated 75 years of operation in October. From Greyvensteyn’s bakery emerged the huge brand name Ouma rusks. The company expanded down the years into a conglomerate and formed a partnership with Simba, a popular potato chips manufacturer.
For the IDC, this was the first of a multitude of loans that built scores of Johannesburg Stock Exchange companies and created hundreds of thousands of jobs.
“Sasol was established in 1950 with an initial capital investment by IDC of R10 million ($700,000) after many years of research on the viability of using South Africa’s abundant low-grade coal resources as sources of liquid fuels. The company produced its first synthetic fuels and chemicals at its plant in Sasolburg in 1955. The NATREF refinery, a joint venture with Total, started producing fuel in 1971 and Sasol II commenced operation in 1983. The company privatized and was listed on the Johannesburg Stock Exchange in 1979,” says Mandla Mpangase, the IDC public relations manager.
Today, Sasol is an Africa-based company leading the technology innovations around the world. This sought after petrochemical giant is actively involved in gas-to-liquids (GTL) technology, using the natural gas to boost innovations and resourcefulness by creating liquid fluids such as diesel and kerosene.  On the FORBES Global 2000 list, ranking the world’s largest public companies, Sasol is ranked 366 and is valued at $21.9 billion.
Over the years, IDC expanded its mandate to lend support to companies beyond South African borders, starting with Mozal, Mozambique’s aluminium smelter, in 1998.
With the 2008/09 global financial crisis, again IDC was prompted to draw up schemes to finance and create jobs for companies in distress.
According to Chief Executive Officer Geoffrey Qhena, the aim of the IDC interventions was only to ensure companies stayed afloat, but also that they grew.
A company born during the apartheid regime, IDC has transformed to serve all in business. Qhena highlighted this at the 20 years celebration of South African democracy in 2014.
“The corporation made sure that companies improved capacity levels and become competitive on the world market. We also focused on developing black industrials. So far, we have spent R4.8 billion ($338 million) to fund black businesses in the in the last 20 years… In the last three years, we have approved 22 projects with a commitment of R13 billion ($900 million),” he said.
So what started with a rusk biscuit on a dusty farm 75 years ago is just getting into its stride.

An Investment Story That Took The Biscuit

The undefeated Lwando Floyd Molwana got the shock of his boxing career as he tumbled to the ground twice after suffering the double jabs and straight rights from experienced former bantamweight champion Oscar Mashudu Chauke.
At the Johannesburg leg of the Premier Boxing League (PBL), the odds were against the 22-year-old Molwana who had to face Chauke in front of his home crowd at the Black Chain Centre in Soweto. Molwana showed guts but couldn’t stop himself from falling to the canvas in the third and fifth rounds.
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The gallant youngster, however, showed heart to continue fighting throughout the action-packed and entertaining six-round bout, much to Chauke’s frustration.
“It was tough but I had to win this one. I thought he’d be down forever when I knocked him down, but he always stood up to fight back. He annoyed me,” says Chauke after winning the fight on points.
Nevertheless, Chauke broke Molwana’s 10-fight undefeated streak and positioned himself among the top contenders for the winner-take-all prize. He also sent out a fearsome message to his next opponent, former South African junior-featherweight champion Macbute Sinyabi.
The night also saw physical onslaughts between Grant Fourie and Vusumzi Tyatyeka as well as Toto Helebe and Innocent Matengo. Chauke’s clinical performance, however, stood out and he earned himself the head honcho award—the prize given to the fighter of the night—worth $500 (R5,000).
These were just six of the 16 boxers vying for the $100,000 (R1 million) overall prize money at stake. This is on top of the $18,000 (R180,000) sum that each boxer receives for participating in three matches over nine months. These fighters made the cut from a pool of 53 applicants.  This is the elite crop that SA boxing currently offers, but none of them have ever come close to earning fees as substantial as this.
“Today we have a South African boxing champion defending his title in Spain for a mere R75,000. At PBL we have boxers fighting six rounds for R60,000 and one boxer stands a chance of winning a million rand,” claims Dicksy Ngqula, the brains behind the boxing league.
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Ngqula, a former television boxing commentator and businessman, spent five years developing this concept to resuscitate boxing before selling it to Boxing South Africa (BSA) in 2012. He was also inspired by cricket’s Indian Premier League (IPL).
“The PBL is modelled on the IPL. It is the first of its kind in the country and its aim is to resuscitate boxing and bring it back to its former glory,” Ngqula says.
South African boxers usually receive $1,000 (R10,000), or less, for a six-round match. The lack of sponsorship is a constant frustration for boxers. Philip Ndou is a former WBA international featherweight and junior lightweight titleholder and fought the world’s pound-for-pound best fighter, Floyd Mayweather. The cash-strapped Ndou recently accepted a fight with little-known Namibian Pohamba Mandume for $4,500 (R45,000), reduced from $10,000 (R100,000), in September.
“Boxing has challenges these days. I know a lot about the rules and regulations of the game because I have been involved in it for more than 10 years as a television commentator. I grew up with the sport back in the Eastern Cape,” says Ngqula.
He says the PBL had to be born to rekindle boxing. It needed a punch to awaken it from its slumber. In the recent past, boxing had been rated among the top sports in the country and enjoyed weekly television broadcasts.
“Through a strategic analysis of the situation, we diagnosed the problems in the sport. We came up with honest questions that required honest answers. So, I think PBL answers some of the problems, including packaging and promotion,” says Ngqula.
“Boxing is definitely not where it used to be and not where it should be at present… You can have the best seven guys in the same division all gunning for the same title, but unfortunately never get the chance to fight each other. We are denied derbies.”
This is what the PBL is trying to achieve. It wants to give boxers a chance to fight for a title. Ngqula says besides paying boxers, what other dissenting promoters call inflated purses, the league aims to empower boxers and increase their marketability.
“We want to see the money going to the boxers. Our vision is to empower them because they are the most important people in the game. South Africa does not quite get that; we want to entrench it,” he claims.
Ngqula says the bouts were reduced to six rounds to create action-packed matches; like Twenty-20 cricket. A minimum of two female fights has also been endorsed as curtain-raisers.
“We want to recruit new spectators to boxing, hence we involved other entertainment forms such as designers, musical acts and betting, but we have to keep the integrity of the game safe,” he says.
The Eastern Cape gambling board, BSA, a local Sunday newspaper and a national television station are among the legion of partners that the league has amassed since launching in March.
The plan for the future is to export the concept to the rest of the continent and then hopefully to international promoters.
“We will export this idea someday. We think we have come up with a novelty business which can be executed anywhere. This is a legacy project. West African promoters have seen this and they want to come on board,” says Ngqula.
The league organizers are meticulous in seeing all participants adhere to boxing regulations. BSA-commissioned medical doctor, Robert Selepe, was on hand to examine the boxers during a weigh-in session a day before the fight. Ngqula told FORBES AFRICA a boxer who fails to meet the weight requirements will forfeit 30% of their match fee.
PBL spokesman, Brian Ndevu, acknowledges that they have earned supporters as well as dissenters. He says the latter does not worry them.
The league was initially supposed to be run monthly but has since deviated from that plan. An event scheduled for Cape Town was skipped for the Johannesburg leg.
In the Eastern Cape, boxing promoters had threatened to banish the tournament in the province, with promoter Ayanda Matiti preventing his two boxers from participating any further. The Western Cape and Eastern Cape are thought to be where most of the PBL’s dissenters reside.
There is a rumor that other small-time promoters disapprove of the PBL’s huge payments, that they can’t match.
But, Ngqula is optimistic about the future. With BSA’s endorsement, and the continued support of spectators, the league is expected to grow over the next five years.
Whether the league continues with the razzmatazz it started with or becomes the international phenomenon that Ngqula envisages, will go to the scorecards.

Bling Returns To The Ring

In just 18 months, a few modest farms on the plains of the Eastern Cape, South Africa will transform into the third largest wind farm in sub-Saharan Africa. The Dorper Wind Farm will produce 100 megawatts (MW) of energy a year.
For the owners of Rainmaker Energy Projects, it’s hard to imagine what 40 towering wind turbines will look like, but Luke Callcott-Stevens and Gavin James are spending R2.5 billion ($274 million) to find out.
“You build a wind farm in 18 months… after four or five years of hard work,” says Callcott-Stevens.
It was New Year in 2009 when James and Callcott-Stevens—friends since university—decided that they were tired of their jobs and wanted to make it on their own.
At the time Callcott-Stevens was looking for wind farm sites for Australian outfit Macquarie Capital, and James was a lawyer. Shortly after—with a third partner in tow, former Macquarie engineer, Doug Jenman—Rainmaker breezed into the market with government tenders in mind.
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That year, the South African government declared its intentions to buy renewable energy at favorable tariffs through its Renewable Energy Feed-In Tariff (REFIT) program. The program gazetted wind energy, promising R1.24 ($0.14) per kilowatt-hour (kWh).
“When we started this out, we couldn’t tell anyone what we were doing and who we were. We were all competing for sites, if you want to go into wind farms now you would have to go and buy it from someone else. But at that point in time we were in frontier country,” says Callcott-Stevens.
The rush to the wild wind of the west had begun with the force of a Californian gold rush. Many companies were looking for coastal sites near Cape Town in the Western Cape and Port Elizabeth in the Eastern Cape, where wind is strong. Rainmaker went its own way inland into the Eastern Cape.
“I racked up 100,000kms driving in a year, just looking for different sites but we couldn’t find another that was as ideal as Dorper,” Callcott-Stevens says.
The site has 10,000 hectares of flat grassland on top of an escarpment flanked by a mountain range, which channels wind to Dorper.
“The whole escarpment is windy, but this is a particularly windy part of that windy escarpment because of this funnel,” he says.
Along with strong wind—which, coincidentally, is at its strongest in winter, when South Africa demands most of its electricity—a wind farm needs to be close to a distribution line to connect to the national grid, South Africa’s national power generator Eskom.
Unlike other companies, Rainmaker is in the unique position that if it wins more phase bids it does not have to look for new sites. With its space, Dorper Wind Farm simply has to construct more 125-meter-high turbines. It has the planning permission to put enough turbines to generate 560MW
Rainmaker has permission to use a 400kV transmission line, which could revive the Canadian Alcan smelter, in Port Elizabeth, which was abandoned because of the country’s power crisis in 2008.
This means that they have the capacity to feed over 1,000MW of energy into the grid.
All seemed lovely in the wind farm industry. In two years, the company struck a deal with an equity partner, Sumitomo Corporation and secured huge bank loans. The Japanese company, says Callcott-Stevens, is a good partner since it helped build one of the largest onshore wind farms in the world: Shepherd’s Flat Wind Farm in Oregon, in the States.
Then in February 2011, disaster struck when the government scrapped REFIT. It was declared an unfair and uncompetitive tender process. This meant a lot of people who had procured loans and deals with renewable energy companies were left high and dry. Government officials mooted a new tariff of 99c/kWh ($0.11/kWh), which meant for many the cost of building farms was just not feasible.
There was a lull for nine months. Rainmaker carried on acquiring loans and negotiating deals with wind turbine companies. Other companies were throwing in their towel at this point.
“We were committed, we were in, we had put our lives on the line,” says Callcott-Stevens.
In June 2011, the wind picked up. The South African Department of Energy (DoE) announced that R47 billion ($5,17 billion) would be thrown into the Renewable Energy Independent Power Producers Programme (REIPPP). The six-phase program picked up where REFIT left off. The government announced it was starting a new bidding process for private business investors to apply for tenders. Investors could procure spots to sell electricity back to the government, not at one set rate, but at a bid price of lower than 115c/kWh ($0.13/kWh).
Eight wind energy projects were chosen, Dorper Wind Farm was one of them. After 2015, REIPPP aims to provide 3,625MW of renewable, clean energy for the country. The largest coal plants in South Africa, like the under construction Medupi coal plant in Limpopo, will generate 4,800MW.
“The next round, we could see a further R7 billion ($700 million) in development and going forward you could theoretically have R30 billion ($3,3 billion) going into infrastructure development in this area in the coming future,” says Callcott-Stevens.
Renewable energy could be a game changer. Ninety seven percent of South Africa’s electricity grid, which has capacity to provide 43,000MW, relies on coal. Even then, it is struggling. Eskom has warned that with overdue maintenance this will be at 33,000MW. This winter could see rolling blackouts; during peak demand periods South Africans can use up to 38,000MW.
A coal plant is able to produce 40 times the amount of energy a wind farm can but new coal power plants will produce power at a higher cost than wind, particularly in South Africa.
According to Ayanda Nakedi, Eskom’s general manager in Renewable Energy, the cost of the rollling blackouts of 2008 was R75/kWh ($8/kWh). This is 84 times the cost of wind power today.
But people should be cautious with wind energy, especially when it comes to solving blackouts, according to Chris Yelland, director of EE Publishers.
“Let us just say that you build a 100MW wind farm. So when the wind is blowing flat out, the wind is going to generate its peak of 100MW&#8230;. The reality is it very often generates at an average of 20 to 25 percent. Although it may generate on average 25MW, for a considerable amount of time it’s producing below 25MW. And this makes wind a big problem, so when you may want the power, you may not get it, and when you don’t want the power, you might get it,” Yelland says.
Currently, South Africa lies near the bottom of the global wind power league. In three years according to Nakedi, it will have climbed to fifteenth. A large slice of this could come from the windswept optimists of Dorper Farm.
It may look easy but risk stalks a wind farm. Bids are not guaranteed.
“For every guy constructing a wind farm there are 20 guys who spent a lot of money, who are nowhere, who don’t have a project,” says Callcott-Stevens.
“We could be hit by a strike onsite, or maybe our turbines could sink in the sea, or we miss our dates when we have to be connected to the grid by, and we stand to lose a lot of money. That could significantly affect our returns over the long-term. There have been projects, in America, where blades have cracked on a wind farm. But these risks get less and less once you have been awarded status under the REIPPP up until the point when you have finished construction,” says Callcott-Stevens.
Further costly delays stem from the administration of REIPPP.  According to Yelland, the DoE needs to be cautious when signing 20-year long contracts under the REIPPP.
“Look at long-term supply contracts, like Eskom with BHP Billiton. It now turns out 10 years down the line that Eskom is locked into selling energy that they now regret. If we buy into these energies on a long-term basis the same could happen,” he says.
So far all phase bids have been delayed at sometime or other. But Callcott-Stevens says that the system has been merely ironing out its wrinkles.
“There have been problems and there are still problems but if you look at where we are coming from, South Africa was a totally regulated power market. It takes a long time to deregulate a market. They did this, relatively quickly; we signed our PPAs [Power Purchase Agreements] last November. Effectively power was deregulated in South Africa,” says Callcott-Stevens.
So, if you want to be a wind farmer, all you need is R2.5 billion ($278 million), an open desolate plain to put your mills on, a few years of patience to win over your investors and a bit of luck, from then on, it’s a breeze.

Reaping The Wild WInd of The West

Attention is not something 46-year-old Sisa Ngebulana seeks but at nearly two meters tall, it is hard to miss him. He also happens to own the aptly named Billion Group, which is worth R3.6 billion ($413 million).
The Johannesburg-headquartered company, located in the Montecasino entertainment complex, is busy with developments, in South Africa alone, worth more than R7 billion ($848 million).
Ngebulana, who was born in Mthatha in the Eastern Cape, also chairs the biggest black-managed property fund in the country—the Rebosis Property Fund. His success is drawing attention but this wasn’t always the case, in a long journey where much has changed.
<div id="attachment_1446" style="width: 310px" class="wp-caption alignleft"><img loading="lazy" decoding="async" aria-describedby="caption-attachment-1446" class="size-medium wp-image-1446" src="/wp-content/uploads/2017/04/Mdantsane04-300x239.jpg" alt="" width="300" height="239" />Mdantsane City Mall, East London, Eastern Cape</div>
“If you take Mdantsane Mall for example it was a piece of veld [field] where women would be raped when they crossed at night. Today, it is a mall that employs thousands of people and which employed 3,000 at its height during construction. The mall also contributes R140 million ($16 million) to the local fiscus,” says Ngebulana.
The R500 million ($57 million) Mdantsane Mall, which was constructed in 2008, was the second biggest mall in the Eastern Cape at the time. It represented the first time the public became aware of the property mogul, even though it was not his first business.
Ngebulana started out as an estate agent while studying towards an LLB degree at the University of Natal. After completing his studies he became a candidate attorney at De Villiers Attorney’s—now Werskmans Attorneys—in Cape Town. In 1996, he moved to Johannesburg to open Blue Truck Rentals.
“That business didn’t go so well. I put all my eggs
in one basket and when one of the bottling companies,
I was contracted to, went down I had to close down.”
He dusted off his law degree and got a nine-to-five job at Eskom, South Africa’s energy supplier, as legal counsel. He moved up the ranks rapidly, but could not repay the bank the money owed for the failed truck business, and gave business another go. This time, he got involved in coal mining.
“With the R10,000-a-month ($1,100) salary; with a take home of just over R5,000 ($573) after deductions I could not have been able to pay the R1 million-a-month ($115,000) I owed the bank. I only qualified for a R230,000 ($26,000) mortgage bond that would have taken 30 years for me to pay back,” he says.
Needless to say, the worse happened—the coal business failed.
After experiencing an 11 month dry-spell, without a job or any prospects, he made a deal with a generous landowner. He subdivided one of the landowner’s plots in upmarket Hyde Park, Johannesburg and sold houses off plan, making a small profit. The bank then gave him an overdraft and he built another cluster of 20 homes.
From the profit, he was able to acquire commercial buildings such as the Bank of Lisbon building in Pretoria. He was now playing with the big boys but problems arose when he decided to go into retail.
“The nice thing about shopping malls is that it’s a science. You have to do your market research, you have to convince retailers. It is hard work and not everyone can do it,” he says.
He encountered challenges even before he started building his flagship R1.5 billion ($172 million) Hemingways shopping mall, in East London. There was a bidding war to build the first regional mall in the Eastern Cape. Some of the biggest names in South African property development—Investec, Growthpoint and Atterbury—wanted a piece of the pie. Everyone agreed that there could only be one winner: the Billion Group.
“Retail, besides track record and delivery, is about location, location, location. I managed to convince the retailers that my location was the best. It is simple as that,” says Ngebulana.
Some argued political interference and many others looked to ensure that he failed even before he started building. Ngebulana becomes animated as he talks about one of his detractors.
“The MD of Grinaker at the time swore he could close us down. He said he had a bigger wallet and was going to discourage subcontractors from doing business with us,” he says.
The Grinaker MD had enough reason to be angry. After his company reneged on the deal to build Hemingways—Grinaker deny that they submitted a tender to build the mall but would not confirm or deny the comments attributed to their former MD—Ngebulana poached some of their senior staff to start Billion Construction. True to the MD’s alleged words, suppliers and subcontractors refused to do business with Billion. So Billion bought material from Europe, opened a concrete manufacturing plant in Mthatha and made its own steel beams on site. The Platinum Group, which owns luxury brands like Aca Joe and Jenni Button, was not ready to open some of its stores in East London so Billion Retail was created.
“The mall was opened not a day too early, not a day too late,” he says.
What of the accusation that Ngebulana is a beneficiary of the ruling African National Congress?
“People speculate too much. I have never had a relationship with the African National Congress. I have never been a member of the ANC. Sometimes I don’t blame these people. Maybe that is what they are seeing of black people in this country; that they only do things because of connections.
“When I won over the retailers in East London, where were politics? When I formed my own contractor, because I was being stifled by competitors, where were politics? There is a war out there. It doesn’t suit certain circles in business to see a black entrepreneur getting to where I am because it motivates others, and tomorrow there will be more black entrepreneurs and the notion of Black Economic Empowerment (BEE) will go out the window” Ngebulana says.
Hombisa Bubu, a former executive at the Billion Group says, “When you work for him every minute must be productive. He is a hands-on kind of guy, very focused and knows what he wants”.
Interestingly, Bubu adds that when he met Ngebulana, in the early 2000s, he already owned a helicopter and a ten-seater airplane.
Billion Group’s outgoing chief financial officer, Thabo Lebelo, says Ngebulana is the most financially literate lawyer he knows and predicts big things to come.
“He is going to be Africa’s own Donald Trump,” he says.
The divorced father of two credits his grandfather for inspiring him to be the man he is today.
“He forced me to make bricks, to go behind the counter at his shop and to study law when I thought I would do better things with my life.”
The Billion Group is in the process of building the R1.75 billion ($201 million) Bay West City Mall in Port Elizabeth and the R1.3 billion ($146 million) Forest Hill City Mall in Pretoria, set to be opened in 2014.
Ngebulana is making in-roads into other countries. There are currently two malls being leased to retailers in Angola—one on the waterfront in Luanda, will cost $150 million; the other, on the mainland, will cost $100 million. The group also plans to build six shopping centers in Nigeria, collectively costing $300 million, and is busy with plans for malls in Uganda, Mozambique and Tanzania. Once complete, these projects will be worth R38 billion ($4.4 billion).
“The future is certainly Africa. The continent is ready for opportunities. There is a lack of formalized retail in the continent. We will be bringing that to the market and that will lead to things like furniture and fashion becoming cheaper,” he says.
Ngebulana is a businessman par excellence but what really drives him? Surely, he has enough money to relax?
“I am not into a game of money but a game of passion. I take risks, I have God on my side and I want to leave a legacy,” he says.

Bricks, Mortar, Passion

When Douglas Stern wakes up in the morning, he looks over the beautiful hills of the Karoo, which cradle his livestock farm in the Eastern Cape. This land is close to his heart and defines his life.
On his bad days, he is haunted by the scenes he saw at numerous hydraulic fracturing sites in the United States of America in July. A local agricultural co-operative sponsored his trip to research hydraulic fracturing or fracking. In Pennsylvania, he saw heartache among people suffering from fracking, which is planned for the Karoo and many other parts of the country.
<div id="attachment_721" style="width: 484px" class="wp-caption alignleft"><img loading="lazy" decoding="async" aria-describedby="caption-attachment-721" class="size-large wp-image-721" src="/wp-content/uploads/2017/04/006-1024x768.jpg" alt="" width="474" height="356" />Douglas Stern and his wife, Liz</div>
“They are gagged by the law because they are forced to sign non-disclosure agreements by the various companies’ lawyers, in return for a water supply to replace theirs, which is contaminated by gas. They [gas companies] hold this ‘holier-than-thou’ attitude. It seems they do what they like and won’t be held accountable, but I won’t let it happen here,” says a determined Stern.
Hydraulic fracturing involves horizontal drilling to create fissures. The insertion of pressurized water, sand and fracking fluids release the gas. Shale gas reserves require a high-volume hydraulic process which uses around 20 million liters of water per fracking incident. In short, it could damage the Karoo’s land and possibly its water.
Stern was born and bred in Graaff-Reinet. This land has been in his family since 1948; he inherited it, from his mother, in 1979. He gained an agricultural diploma from Grootfontein College in Middelburg. Farming is his life and he won’t allow gas companies to ruin it. In this part of the country, water is life. His daily water usage for domestic and farming purposes adds up to 1,512,600 liters.
“In my view, it’s the government’s responsibility to tell them to bug off. Our constitution is strong and allows us to earn an honest living and be exempt from such possible water contamination,” he says.
Derek Light, the epitome of a small-town attorney, represents the farmers of Graaff-Reinet, who see themselves as guardians of the Karoo. Many of Light’s 300 landowner clients refer to him as a saint, a humble man and a saviour. He also represents Agri-Eastern Cape, which brings his representation up to thousands of farmers and landowners. The Eastern Cape produces around a third of South Africa’s livestock.
The protestors want to stop the landscape from being littered with drilling rigs. That could happen if international energy companies are granted the rights to exploit gas. “Imagine well pads every three to five kilometres, for thousands of kilometres, which will be interlinked with roads. You’ll have a highway of pipelines all over the country to Mossel Bay, Coega, a Sasol plant or wherever you want it. You won’t recognize this country, it’ll be a wasteland,” he says.
<img loading="lazy" decoding="async" class="alignleft size-large wp-image-722" src="/wp-content/uploads/2017/04/DSC_4530-680x1024.jpg" alt="" width="474" height="714" />
The protestors are not immune from criticism. Their critics ask whether their landownership is valid as they are not ‘traditional’ owners of the property. Light feels that this view is aimed at creating a divide between South Africans and that it has nothing to do with the scientific research in question.
“People tell us to wind our necks in. We’re saying, don’t come with false promises… We don’t want our land harmed to the detriment of all our people. But sadly, people are sometimes persuaded by their political views,” Light says.
It all began in October 2008, when the worried owners of Samara private game reserve, in the Karoo, approached Light. In a lengthy process, Light successfully opposed three of Sunset Energy’s applications for exploration rights before the local regulator, Petroleum Agency South Africa (PASA). Sunset Energy is the Australian subsidiary of South African Bundu Oil and Gas.
More clients approached Light after Falcon Oil and Gas—a Canadian company—applied for exploration rights elsewhere in the Karoo, spanning 30,000km2.
In January 2011, PASA accepted three of Shell’s applications for fracking in three areas in the eastern, central and western Karoo covering 90,000km2.
Light addressed landowners from around Graaff-Reinet. It drew the big names: multi-billionaire Johann Rupert, whose father was a founding member of the World Wildlife Foundation; and Dutch Princess Irene, a Karoo landowner. She even had a full audit conducted to prove that she has no links with Dutch company Shell.
“What had been a lonely fight for me and a handful of landowners suddenly entered the public domain and became big,” he says.
Light filed applications against Falcon Oil and Gas and the three Shell applications in March 2011. PASA directed objections against the five applications to regional committees to be adjudicated. It had been swamped with applications concerning parts of KwaZulu-Natal, the Eastern Cape, Northern Cape and the Free State.
On April 29, 2011, Susan Shabangu, Minister of the Department of Mineral Resources, placed a moratorium on all applications for six months and extended it for another six months to allow for investigation.
The process is determined by the Mineral and Petroleum Resources Development Act (MPRDA) of 2002. According to the act, the applicants should determine how the environment will be affected.
“I am satisfied that in law none of these companies have complied with their legal obligations in terms of the MPRDA. There are, in my view, shortcomings in the processes currently regulated, in that it’s certainly inadequate to deal with a situation of this magnitude. I have very little doubt in my mind that the courts will intervene if the applications are granted under the current circumstances,” says Light.
The government and South African citizens have an obligation to preserve their environment for future generations. While the moratorium passed in mid-February, the investigation’s findings are expected to be presented to cabinet by the end of July. Energy Minister Dipuo Peters is awaiting cabinet’s decision. She has conflicting views about fracking: while it could ensure energy supply security, it needs to be done safely.
“If we need 10 years to decide, then we need to take those 10 years,” says Light.
Light questions how fracking fits into South Africa’s long-term energy planning. Do the benefits outweigh the costs? He suggests the government considers the Mozambican offshore natural gas find as an affordable, alternative source.
Stern agrees: “The gas industry in the United States went from boom to bust. At the moment, gas is being produced at a loss because there’s an over-supply. South Africa can purchase gas far more cheaply than it can produce it.”
Light talks about the report by respected economist Tony Twine, who died in March, which was commissioned by Shell. “He had to make huge assumptions about the extent of the gas reserves in the Karoo; the price of gas when it comes into production in 10 to 15 years’ time; and the cost of producing it in South Africa. He [Twine] acknowledged that he had to make those assumptions, which rendered the report nonsense because you could equally make other assumptions,” says Light.
The protestors also claim that the industry in the US was regulated poorly; they made fatal errors and are now putting on the brakes so they can re-regulate.
According to Stern, incidents of water contamination and chemical spillage have been reported throughout the US. The claim from gas companies is that there is a natural barrier of impermeable rock between the area you frack and the ground water.
There is also concern about the chemicals that could be used. They sub-contract the process to other companies that want to protect trade secrets, which means that certain chemicals are undisclosed. Some of the chemicals are known carcinogens and toxic: simply put, hazardous to health.
Two recent studies, conducted in Denver by Petron and Howarth, suggest that 4% of the methane gas was leaking. According to Stern’s research conducted in the States, he found that 5% of wells were failing on an ongoing basis, which resulted in further leaking.
Countries should consider renewable energy sources like solar and wind power as clean, alternative energy sources, say Karoo farmers.
“We [farmers] are very conservative people in the Karoo with regard to our water because it is sacrosanct and we have droughts. As a consequence, I never use more than half of my borehole water capacity. My concern is that they will say to me, ‘But you’re not using the other 50%’,” says Stern.
“The rate of recharge is very low in the Karoo—scientists tell us it’s between 2-3%—and it could take decades or even hundreds of years to recharge when you take water in those volumes,” says Light.
Once exploration rights are granted, the applicants have to conduct a public participation meetings.
“We were appalled by how sly they were,” mentioned a Karoo farmer who was eager to talk and who had attended a public participation meeting.
“They didn’t even show their faces. They sat in amongst us like cowards. It’s a very large area we represent, so I don’t know every farmer within the district and neither does the next. Derek Light was standing in front of us, by himself, waiting for answers from representatives who, it seemed, didn’t even bother to show up. They wanted to see who they were up against.”
The country awaits cabinet’s final verdict. It’s a case of determined farmers versus equally determined international energy companies, who have deep pockets and big-city lawyers.

Tag: Eastern Cape

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