BOTSHELO WATER

1
BOTSHELO WATER
Financial Year 1 July 05 30 June 06
Year of turmoil
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As at 1 July 2005

• Gobodo forensic audit was a dark cloud hanging
  over management

• Mr Letimela, the CEO was on permanent study leave

• Mrs Sebekedi, the Chairperson of the Board, was
  also the Acting CEO

• Two Senior Managers were on Suspension
• Manager Admin Finance
• Manager Operations

3
On 1 September 2005

• Mr Naraghi Manager Technical services replaced
  Mrs Sebekedi as the Acting CEO

• On 24 October 2005

• The Board terminated the services of Mr
  Letimela, the CEO, due to financial irregularities

4
On 28 November 2005

• Mr Naraghi the Acting CEO was suspended due
  to his unilateral re-appointment of the Tswasa
  Manager at a remuneration package not agreed to
  by the Board.

• Mr Janse v Rensburg the Senior Projects
  Manager, was appointed the Acting CEO

5
On 31 December 2005

• Voluntary severance packages were offered to
  three senior Managers
• Mr. Ackon Manager Admin Finance
• Mr Naraghi Manager Technical Services
• Mr Makhele Manager Human Recources

6
On 20 January 2006

• Mrs Sebekedi, Chairperson of the Board, resigned
  on grounds of poor health.

• Mr Ntefang assumed duties as acting Chairperson
  of the Board.

7
On 1 March 2006

• Mr Ntefang was appointed as the Chairperson of
  the Board

• On 24 April 2006

• Mr Jan vd Merwe, a consultant, was appointed as
  Acting Financial Manager

8
On 27 May 2006
Botshelo Water received the sad news the
passing of Mr Letimela, the former CEO

• As at 30 June 2006

Botshelo Water operated with a skeleton
Management Team
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Key Developments after 1 July 2006

• Mr Janse v Rensburg accepted a voluntary
  severance package and left BW on 31 Oct 2006

• Mr Placid Fernandez was appointed CEO with
  effect from 1 December 2006

• The tenure of Board of Botshelo Water ended on
  31 December 2006

• New members for the Board still to be appointed

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Botshelo Water COVERS 42 OF THE PROVINCE
Magalies
BW
Rand
Sedibeng
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Total 1,096,000
25
75
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Botshelo Water is aone stop services- delivery
WSPFrom Source to Tap and Loo to River
SEWAGE, SANITATION
RAW WATER
ASSET MANAGEMENT
BULK WATER
PROJECTS
BILLING
COLLECTION
WATER LOSS MANAGEMENT
COST RECOVERY
RURAL
RETAIL
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BWs STRATEGIC INVOLVEMENTS

• Cocodile Marico West Catchment Management
  Agency
• Served as Deputy Chair of Molopo Water
  Management Forum

• North West Water Services Forum
• Served as a member of the forum which supports
  the PGDS to develop strategies for water services
  delivery.

• Provincial Growth and Development Strategy
• Served as a member of the Infrastructure and
  Construction Working Group.

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Operations
The Year started with BW operating in 4 WSAs and
one International Scheme

• Tshwane Metro Municipality
• Klipgat STW
• Temba STW

• Moses Kotane LM
• Madikwe Area

• Bophirima DM
• Kagisano LM
• Molopo LM

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Operations

• Modiri Molema DM
• Mafikeng LM
• Ramotshere Moiloa LM
• Ditsobotla LM
• Ratlou LM

• Tswasa Water Scheme Raw water supply to
  Gaborone Botswana and Derdepoort Irrigation
  Farmers
• Molatedi Dam

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INFRASTRUCTURE PROJECTS
Dinokana pipeline new reservoir to augment
water supply to Welbedacht R 8,2 million
Drought relief work in Pella, Madikwe, Siga,
Mmatau and Lethlakeng R 8,1 million
Refurbish two filters at Modimola WTW R 0,9
million
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Operations Bulk water Supplies
Operated and Maintained 8 Water Treatment Works

• Mmabatho (Modimola)
• Mafikeng (Rooigrond)
• Motswedi (Sehujwane Dam)
• Kopfontein (Botswana Border)
• Molatedi (Molatedi Dam)
• Derdepoort (Mooiplaas)
• Pella (Pella Dam)
• Madikwe (Madikwe Dam)

Handed over to MKLM w.e.f. 1 Jul 06
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Operations Bulk water Supplies
Supply of water without formal treatment

• Itsoseng (Ditsobotla LM)
• Dinokana/Lehurutshe (Ramotshere Moiloa LM)

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Retail water supplies

• Ganyesa (Bophirima DM/Kagisano LM)
• Bray, Tosca Pomfret (Molopo LM)
• Lehurutshe (Ramotshere Moiloa LM/Modiri
  Molema DM)
• Madikwe (Moses Kotane LM)

Handed over to MKLM w.e.f. 1 Jul 06
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TSWASA INTERNATIONAL SCHEME
BW operated the Tswasa Scheme.
During the period under review, we supplied
5,708,350 Mm3 to Derdepoort Irrigation Farmers
4,559,744 Mm3 to Gaborone, Botswana
254,434 Mm3 to Madikwe Game Reserve other minor
consumers
No water releases were made to Derdepoort farmers
during Nov 2005 to May 2006 due to restrictions
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Operations Sanitation Services
Operated and Maintained the following Sewage
Purification Plants

• Klipgat
• Temba
• Mogwase

Klipgat WWTW
Handed over to Tshwane Metro w.e.f. 1 Oct 05
Handed over to MKLM w.e.f. 1 July 06
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Operations Sanitation Services
Operated and Maintained the following 5 Sewage
Purification Plants on behalf of other Government
bodies

• Thusong Hospital
• Gelukspan Hospital
• Bophelong Hospital
• Mafikeng Airport
• Motswedi

23
TRAINING
81 Employees (63 Males / 18 Females) received
training for developing skills R 456,494 was
spent
24
Communication
BW participates on a monthly program through
Radio Motsweding, to interact with the Community
on water related issues
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Operations Rural Water Supplies
Coupled with rural schemes 2340 boreholes were
operated / maintained so as to provide potable
water to rural communities
Some of the windmills supply both domestic and
livestock.
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Quality of drinking water supplied
Total volume of water supplied from Treatment
Plants 13.9 Mm3 Number of tests carried out
1596 Number of failures 39 Of the failures 30
related to insufficient Chlorine levels 9
related to Microbial parameter failures
Action was taken to disinfect the water
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Quality of drinking water supplied
BOREHOLES IN THE RURAL AREAS
Number of tests carried out in suspected
locations 120 Number of failures 66 Of the
failures 31 had bacterial failure 23 related to
Nitrates 12 related to Fluorides
Regular monitoring of water quality is required.
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• ASSET MANAGEMENT
• BW does not own any Water Services
  Infrastructure assets
• BW has established a Preventative Maintenance
  System through the aid of computer software
  (PRAGMA SYSTEM).
• This computerized system helps to effectively
  plan, monitor, control and report on the assets
  operated by us.

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During the year operations shrunk
The Projects Division had to surrender
implementation of new water supply projects to
WSAs
On 1 October 2005
Tshwane MM took over the operation and
maintenance of Klipgat and Temba STWs
Arrangements were finalised for Moses Kotane LM
to take over operations in Madikwe area with
effect from 1 July 2006
This 23 shrinking of activities had an
increasing effect on the water tariff in the
remaining areas as fewer cost centres shared in
the Head Office Overhead costs.
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Challenges facing BW as at 30 June 06

• Collection of outstanding debts
• Total owed to BW R128 mill
• Amount owed by BW to DWAF R 43,4 mill

• Outcome of Sect 78 process for Bophirima DM and
  Ngaka Modiri Molema DM (former Central DM) which
  is ongoing will have a great impact on the future
  role of BW in the Water Industry.

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Supply of Potable Water Supply of Potable Water Supply of Potable Water
Water Sales (R Mill) Amount Billed Amount Paid
Mafikeng LM 28.3 25.7
Moses Kotane LM 5.0 3.0
Bophirima DM 6.4 3.7
Ditsobotla LM 3.0 0.5
Other Consumers 8.2 3.5
Total 50.9 36.4
R 14,5 Mill (28.5) short paid by Clients!! R 14,5 Mill (28.5) short paid by Clients!! R 14,5 Mill (28.5) short paid by Clients!!
Other Operations    
Rural Maintenance 47.7 43.0
Sewage Recovery 6.4 5.5
Total 54.1 48.5
R 5,6 Mill (10.4) short paid by Clients!! R 5,6 Mill (10.4) short paid by Clients!! R 5,6 Mill (10.4) short paid by Clients!!
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BW received a qualified audit report for the year
for the following reasons

• A Loss of R36,3 M was incurred during the year
  and liabilities exceeded assets by R29,8 M. The
  ability to continue as a going concern is
  dependent on the financial support of DWAF

• IAS16 (AC123) IAS36 (AC128) not followed,
  Auditors could not confirm the valuation of
  Property, plant and equipment.

• a Property in BWs books with a value of
  R180,618 is registered under Mafikeng Local
  Municipaliy

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KEY ACHIEVEMENTS

• DWAF positive acceptance of the five year (2006
  2011) business plan

• Service provider agreements with WSAs
• between Bophirima DM and BW signed on 31 Oct 05
• between Central DM and BW under discussion

• Memorandum of understanding between Midvaal
  Water Company and BW for the possible
  utilisation of potable water from the
  Stilfontein Midvaal Plant to serve CDM areas and
  even Botswana signed on 10 February 2006

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Other Achievements

• BW received the PMR Diamond Arrow Award in
  December 2006 in respect of its performance
  during the 2005/06 financial year.

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Our Dream
To become the recognised global model for the
efficient and effective supply of quality water
and sanitation services, whilst recognising the
right of all to access basic water services.