Raygen Phillips’ resignation comes on the heels of a meeting between officials from the Department of Public Enterprises and Parliament’s Portfolio Committee on Public Enterprises last week, which revealed the cash reserves of the Pooling and Sharing Joint Venture (PSJV) between Alexkor SOC and the Richtersveld Mining Company will be depleted by September 2020. 

In the internal memorandum leaked to OFM News, the Chairperson of the venture and Chief Executive Officer (CEO) of Alexkor SOC, Lemogang Pitsoe, announced on Wednesday that Phillips stepped down in consideration of her own personal career development plans. Her resignation came into effect on Monday, 24 August. “We wish her well with her future endeavors and would like to thank her for her contribution to the PSJV,” concludes Pitsoe.

In May, former administrator at the diamond mining company, Lloyd McPatie, informed the portfolio committee on public enterprises in a virtual meeting that the CEO of the PSJV, Mervyn Carstens, had been suspended in February following an investigation into allegations of corruption and mismanagement at the Alexander Bay mine by auditing firm, Gobodo Forensic and Investigative Accounting. McPatie was appointed as the administrator of the mining entity after Public Enterprises Minister, Pravin Gordhan, axed Alexkor’s board members due to doubts in their ability to manage the mining company’s affairs.  

McPatie did not go into details regarding the exact charges laid against Carstens during the May meeting only informing the committee that Carstens had dragged him and Alexkor to the Council for Conciliation. Mediation, and Arbitration (CCMA). He said at the time the CCMA hearing took place after his tenure as administrator had come to an end in March, and he was therefore not able to inform the committee what the outcome of the CCMA matter was. The Gobodo report also found the sales and marketing contract awarded to Scarlett Sky investments (SSI) in 2015 to be irregular. The contract came to national attention in the #GuptaLeaks series by the Mail and Guardian’s Amabungane and the Daily Maverick’s Scorpio teams in 2017. They linked SSI to the Gupta family as a part of their series into state capture. 

Despite the contract being declared as irregular, McPatie informed the Portfolio Committee that cancelling it outright would devastate the already poverty-stricken Richtersveld community. The dire financial situation at the PSJV is such that they cannot afford to go a month without selling any diamonds.

Alexkor is reportedly on its last legs having had reported a loss over the 2019/20 financial year. In the notes from the briefing last week, it’s revealed the mine derived its income from debt. “It had a very erratic performance due to poor management, low diamond prices, and corruption”. It has been said the Department of Public Enterprises is unable to provide more financial support for the mine especially without the mine’s ability to generate revenue. The impact of the mine’s financial state has already been felt in the Northern Cape town of Alexander Bay, with the mine retrenching almost 200 employees.

OFM News