Secret talks with US-based Astra Energy raise corruption fears in LHWP

15 November 2024 by Pascalinah Kabi

This investigation was produced with the support of Paballo-ea-Bophelo, an advocacy group dedicated to promoting media literacy and investigative journalism.

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In a controversial move reminiscent of past corruption scandals within the Lesotho Highlands Water Project (LHWP), Prime Minister Ntsokoane Matekane’s administration has questionably attempted to bring in US-based Astra Energy to fund Phase II of the project without adhering to proper administrative protocols.

Government attempted a plan to covertly engage Astra Energy as funders for the Phase II hydroelectric component, bypassing the project implementers, the Lesotho Highlands Development Authority (LHDA).

In fact, the Matekane administration only involved the LHDA on March 7 when the LHDA was directed to hold a confidential meeting with Astra Energy.

In a secret recording from the same day, which Uncensored News/Public Eye has access to, Astra Energy representatives noted that the meeting between its representatives and the LHDA was organised by Minister of Natural Resources, Mohlomi Moleko.

An Astra Energy representative, identified as Gregory, explained that the meeting came about after Moleko failed to answer questions regarding the hydroelectric project, implying that if Moleko had addressed these questions, the Matekane administration might have proceeded without involving the LHDA in its covert effort to appoint Astra Energy as funders.

In their own admission, Astra Energy representative said they are aware that it is “unusual” for them to provide unsolicited funding to the LHDA after Matekane’s regime asked Astra Energy if they can “put money together” for the hydroelectricity component.

“They asked us if we had an interest and if we could put the money together to build the hydro dam, and we said yes. So, then we were asking the minister some questions yesterday (March 6, 2024). So, he (Moleko) empowered this panel today (March 7, 2024) for us to ask some questions and get some information,” they said.

The meeting between Astra Energy and the LHDA was allegedly organised by Minister Moleko as part of the agenda of the Matekane-led administration.

Attempts to obtain a comment from Astra Energy were unsuccessful at the time of publication. Although a mail tracker indicated that the email sent to Astra Energy was read multiple times, the American-based company had not responded to the emailed questions by the time of going to print.

While Astra Energy had not responded by the time of publication, the issue of the March 7 meeting has since sparked controversy with Minister Moleko, who hotly denied organising the meeting or having any knowledge of Astra Energy.

“It is not factual that I organised the meeting; in fact, I do not even know who Astra Energy are,” Moleko told Uncensored News/Public Eye on November 8.

Despite Minister Moleko’s strong denial of organising the meeting or knowing Astra Energy, Senator Seabata Motsamai, who attended the meeting as Astra Energy’s local contact, provided a different perspective.

In a November 8 interview with Uncensored News/Public Eye, Motsamai explained that Astra Energy collaborates with a Canadian company that facilitates investments on Astra’s behalf.

“I am their local partner. They had an appointment with the minister, and since Astra was already visiting Lesotho for other energy-related projects, they met with Minister Moleko, who oversees government policy matters,” Motsamai said.

He added: “After their discussion, Minister Moleko recommended they meet with the implementing agency, the LHDA, to discuss hydropower-related issues. We attended the meeting organised by Minister Moleko to hear directly from the LHDA on hydropower matters.”

Astra Energy’s unusual funding offer

At the March 7 meeting, Astra Energy representatives revealed that Matekane’s administration had hinted at a need for 600 million to complete the project. It remains unclear to Uncensored News/Public Eye whether this figure was intended in US dollars or Maloti, as Astra Energy did not specify the currency.

In this meeting, Astra Energy was represented by Gregory and Peter from Canada, and Jeffry from the United States. The LHDA’s Chief Executive, Tente Tente, and the LHDA’s Divisional Manager of Development and Operations, Reentseng Molapo, also attended.

Additionally, Themba Sopeng, who was Lesotho’s chief delegate to the Lesotho Water Commission at the time, was present, along with government advisor on the Lesotho Highlands Water Project, Masupha Sole, and Senator Motsamai.

As discussions continued, Astra Energy representative believed to be Gregory, is heard telling the LHDA that the US-based company was fully aware that their approach was “unusual”.

“I know this is unusual, you have people coming and saying they want to fund it before even seeing anything. We are interested, and we want to help you, and we want to try to move this thing forward,” he said.

To help move the hydropower component forward, Astra Energy said they needed to have access to confidential information that include environmental reports, and feasibility studies.

To get the LHDA to release these documents, Astra Energy said it was prepared to sign a non-disclosure agreement (NDA) with the LHDA, similar to the NDA it had already signed with the Lesotho government.

“So, I guess the number one question is how far along are you? Do we have designs? Do we have environmental reports? Do we have feasibility studies? Do we want to sign an NDA, or do you want us to sign an NDA? We have already signed an NDA with the government right now,” he said.

Sources close to the matter, speaking on condition of anonymity due to fear of reprisals, indicated that Astra Energy’s readiness to sign an additional NDA underscored their eagerness to access confidential project details and advance their involvement.

In an exclusive interview, however, Motsamai clarified that the meeting’s purpose was not to exert undue influence on the LHDA but rather to gain a clearer understanding of the Oxbow project’s progress after Minister Moleko allegedly gave Astra Energy the impression it was at an advanced stage.

“After meeting with the official responsible for policy-related matters, who conveyed that Lesotho aims to increase energy production for local and export, we were led to believe that the LHDA had three key tasks remaining: completing the feasibility study, project design, and other details.

“That was the impression we had, but the LHDA later informed us that they are primarily focused on the Environmental Impact Assessment (EIA), which is what I recall. The meeting’s purpose was simply to understand the progress LHDA has made,” Motsamai explained.

When Uncensored News/Public Eye contacted LHDA’s Chief Executive Tente Tente for comment on October 25 he declined to comment on matters related to the March 7 meeting.

Astra pressures Tente with Matekane meeting

Despite Tente’s refusal to comment publicly, details from the March 7 meeting reveal his firm stance on confidentiality, emphasising that he could only share information already accessible to the public.

“I can only avail information that’s already in the public. When we did the RFP (Request for Proposals) for the consultants, we availed some information to ease the tendering process and to level the playing fields,” Tente said, explaining that certain firms involved in the feasibility study were also interested in bidding on subsequent stages.

Astra Energy pressed Tente for more details, requesting: “You give us a list of exactly what you need and the monies that you need to complete these studies.”

Tente responded by emphasising the protocols that govern information sharing, noting, “I would love to have the monies and the likes, but our governance process is quite rigid. And there are certain loops and hoops that I would have to jump before I can get to easily engaging at that level.”

Astra Energy continued pushing for access to confidential documents, indicating its financial readiness to support the project’s bankability.

“We know where the money is. We are putting together $1.6 billion right now for an African bond that we’re doing, we would love to be able to throw this project into it, to be able to know that you have the money right away, you have to go ahead and do it. And then we would like to be able to participate with you in the final designs of the project,” Astra Energy representative said.

Tente maintained his stance, responding, “I understand all that. I am just saying to you that my hands are tied. Governance processes would not allow me to just conclude that process with you now and make pronouncements.”

As Tente explained the limitations of his authority, Astra Energy representatives revealed that they had met “with the heads of your government yesterday (March 6, 2024.) All of the ministers involved with this thing, plus the prime minister, chief of staff.”

In response to this, Tente replied, “All they can do is to instruct me.”

This response led to Astra Energy representative indicating that they do not want to be confrontational.

“But I don’t want to be confrontational or anything. I don’t want that kind of stuff. I am here to try and say, hey, you need help. If you need help, then we’re here to give you help.”

Despite the Astra Energy representative admitting that he did not want to be confrontational about obtaining documents, Motsamai disagreed with the interpretation of the March 7 meeting.

In an interview, he denied that the meeting’s purpose was to pressure the LHDA into disclosing confidential information to Astra Energy, calling such claims a misinterpretation of the facts.

“There was no other confidential document, at least from my perspective, that the LHDA would have said, ‘I have this document on the table, and it will give these people an added advantage if it gets out.’ I believe these are misinterpretations and cannot accurately reflect what actually happened,” Motsamai told Uncensored News/Public Eye.

Seabata Motsamai calms tension

While Motsamai denied claims that Astra Energy attempted to use the March 7 meeting to gain an added advantage by obtaining inside knowledge on the Oxbow project, his approach was notably different during the high-stakes closed-door discussions.

In the meeting, when Astra Energy representatives raised concerns about potential conflict due to the LHDA’s refusal to release confidential project documents, Motsamai proposed a diplomatic solution

“I think the next step is this. We have now to get back to the government, to go back and report to the minister (that) this is what we understand from these guys,” Motsamai advised.

He suggested that future actions should align with the government’s directive, possibly involving a presentation to the cabinet for further guidance.

Motsamai emphasised that the process should follow established protocols, including drafting a Memorandum of Understanding (MOU) and handling disclosures in line with normal procedures.

“At that level, that’s where now the technical, you will look at areas that can be done parallel. Or that can also be fast-tracked depending on the areas that of understanding,” Motsamai said.

He reassured Astra Energy of LHDA’s legitimacy and commitment, adding, “let’s directly improve this channel, now we go back to the government. And then be able to find how the government is intending to move on this matter.”

Tente agreed, acknowledging Motsamai’s approach as “the most viable way of going about it.”

However, Astra Energy representatives expressed dissatisfaction with the meeting’s outcome, saying, “I don’t want to take up any more of your valuable time because there’s really nothing we can accomplish at this meeting.”

Tente reiterated the LHDA’s position saying: “in the form of concluding or making firm commitments, I am not in that position.”

Astra escalates offer to Matekane

With Tente standing firm, Astra Energy representatives warned they would escalate their concerns to Prime Minister Matekane and other unnamed ministers.

“We would love to help Lesotho move forward with our expertise and with our money, so I will hammer that into the powers that be upstairs,” they remarked, to which Tente replied, “Please do.”

Motsamai urged a measured approach, advising they consult the minister, adding, “ntate, based on the things, are you exploring to move forward with this so that we know which (approach) to follow?”

As a public agency bound by Lesotho’s regulations, Tente indicated that the LHDA typically avoids direct negotiations or unsolicited deals.  

Tente noted: “We go the route of asking for expression of interest. I know that there are lots of similar proposals coming through, similar entities expressing interest. I was even talking to the minister yesterday (March 6, 2024) saying it’s better that we do an expo.”

He explained LHDA’s plan to issue a public inquiry document, encouraging Astra to participate openly.

Tente explained that open participation would allow LHDA to: “get the menu, select the best one but I have my principals as well. I can be directed to follow a different approach.”

“Yesterday I mentioned something by President Biden that sent out a statement that there is $52 billion which they want to pour into Africa for renewable energy. Could you also find out what the possibilities are where they are?”

Astra Energy representatives highlighted international interest on Africa’s renewable energy, explaining, “We have clients that are billion-dollar companies and stuff like that that would jump to put $100 million into a bond because they get to write off $150 million against income that they’re making somewhere else in the world, like the Shells and all the big oil companies and stuff.”

When Uncensored News/Public Eye asked Tente for further comment on October 25, he stated, “I cannot comment.”

Corruption concerns within the LHWP first surfaced in 1993 when government commissioned an audit of both the parastatal bodies which shared responsibility for the project. The audit revealed obvious and substantial administrative irregularities within the LHDA.

After the audit the LHDA’s then CEO, Sole, was then subjected to a disciplinary enquiry, and subsequently dismissed.

In August 1997 government applied to the Switzerland’s judiciary for disclosure of a number of Swiss bank accounts, including those belonging to Sole which indicated that he had received millions of Maloti for which he offered no explanation – leading to in October 1999 judgment given against him for the sum of M8.9 million in a civil suit.

Bank records obtained from Switzerland indicated that throughout the lifetime of the project, Sole, using intermediaries, had indirectly received vast sums of money from certain companies and consortia who had been awarded contracts in the LHWP.

Sole and 18 other defendants were charged with counts that included bribery, fraud and perjury.

A comprehensive judgment by Justice Peter Brendan Cullinan found Sole guilty as charged, and sentenced him to prison for 18 years, reduced on appeal to 15 years.

Meanwhile, Motsamai told Uncensored News/Public Eye that allegations suggesting Astra Energy was attempting to gain an added advantage by bypassing established systems within the LHDA would not sit well with the United States (US) Embassy in Lesotho.

“How can they bypass due processes? The Americans would not allow that. These are American-based companies, and when they arrive in Lesotho, they first report to the US Embassy. Americans are very strict when it comes to these matters,” Motsamai said.

On October 29 the Maseru Embassy Public Affairs Officer, Charles Blake, said the US government is aware that Astra Energy is pursuing business opportunities in Lesotho. But, the Maseru Embassy was quick to point out that the US government is committed to ensuring that American companies, and businesses in general, operate under principles of fair and transparent competition.

“This commitment promotes equitable access to opportunities, helping economies function more efficiently and inspiring confidence in the system, which benefits all parties involved,” Blake said.

Blake said the US government encourages American businesses to explore investment and business opportunities abroad, provided these activities are carried out transparently and in compliance with both US and host country laws.

“US companies that expand responsibly into new markets contribute to economic growth, support local development, and strengthen commercial ties between nations.”