The cost of constructing the corruption-plagued Ha Belo electricity substation in Butha-Buthe has more than doubled, rising from the original M86.6 million to over M170 million. The project, which has faced years of delays and allegations of mismanagement, is now being completed by South African electrical engineering firm Actom (Pty) Ltd.
The Ministry of Energy confirmed that Actom has been engaged directly to finish the project at a cost of M49,720,215.42. The decision follows the termination of the contract with Phaks Joint Venture (Phaks JV), which had been deemed incapable of completing the project despite receiving significant payments.
Phaks JV was initially awarded the contract on 18 August 2021 for the construction of the Ha Belo 33/11kV substation and 33kV transmission lines under the Lesotho Renewable Energy and Energy Access Project (LREEAP). The work began in November 2021 and was expected to be completed by April 2023. However, progress stalled and the project remained unfinished even after costs increased to M121,577,004.21.
The project was divided into three parts: the installation of a transmission line from Ha Mopeli to Ha Belo, another from Hlotse to Ha Belo, and the construction of the power substation at the Ha Belo industrial site.
According to the Ministry of Energy, Phaks JV was paid for procurement of equipment, but only a small portion was delivered and installed. Limited progress was made on the transmission lines, leading to a full halt in 2023 after the funds were depleted. In June 2025, the government refunded M22 million to the World Bank after failing to account for funds allocated to the project.
The ministry’s statement cited “bad administration and mismanagement” as reasons for the cost overruns. It confirmed that the decision to engage Actom directly was based on the company’s previous role as the subcontracted equipment manufacturer under Phaks JV.
Negotiations with Phaks JV to resume work in early 2024 were unsuccessful. The ministry then opted to pay for the remaining equipment directly to prevent it from being auctioned, converting it into government property. The new contract with Actom, signed on 20 September 2025 by Energy Principal Secretary Tankiso Phapano, now tasks the company with completing all outstanding works.
Attempts to reach Mr. Phapano for comment were unsuccessful. However, ministry sources said the move to Actom was necessary to ensure technical completion. “It makes sense for the ministry to engage Actom directly,” a source said. “They were already the equipment manufacturer and have the technical expertise that Phaks JV lacked.”
Former Energy Principal Secretary, Themba Sopeng, and several others are facing corruption and money laundering charges related to the Ha Belo project. The Directorate on Corruption and Economic Offences (DCEO) accused Mr. Sopeng of manipulating the procurement process in 2021 to favor Phaks JV.
In June 2025, Prime Minister Sam Matekane announced that an additional M50 million would be required to complete the project.
The Ha Belo substation forms part of the World Bank-funded LREEAP, which aims to expand electricity access in rural and peri-urban areas while promoting sustainable energy solutions through mini-grids.
Despite the financial and administrative turmoil, the government insists that completion of the Ha Belo project remains a priority to ensure reliable electricity supply for industrial and community development in Butha-Buthe.
Lesotho News WhatsApp Channel | Lesotho News
Join ‘Lesotho News’ WhatsApp Channel
Get breaking Lesotho news — delivered directly to your WhatsApp.
CLICK HERE TO JOIN
