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Wed Jun 29 14:42:46 CAT 2016

Eskom's coal now supplied by the Guptas

Bloomberg | 29 January, 2016 00:36
Arnot was supplying 20% of the 2000MW power station's coal needs, Eskom said. File photo
Image by: Dean Hutton / Bloomberg

Eskom has started buying coal for its Arnot power station from a mine that is being acquired by the Gupta family, friends of President Jacob Zuma, after a contract with Exxaro Resources was cancelled, said three people, who did not want to be named.

Eskom Holdings did not renew Exxaro's contract to supply Arnot from a nearby mine at the end of December because, it said, the prices were too high.

Arnot was supplying 20% of the 2000MW power station's coal needs, Eskom said.

Optimum Coal, the mine now supplying Arnot, is being acquired by a company controlled by the Guptas after the operation, formerly owned by Glencore, was placed under administration because Eskom would not relax the terms of a contract for the supply of coal to its Hendrina power station.

Glencore said the mine had become loss-making because of Eskom's stance.

Tegeta, which is buying Optimum, is owned by the Gupta family's Oakbay Resources & Energy.

Tegeta official Jacques Roux did not answer calls to his cellph one.

Eskom spokesman Khulu Phasiwe said Arnot has been sourcing coal from other suppliers since the Exxaro contract expired.

He said he had "no information" about the arrangement with Optimum.

Optimum has been supplying coal to Arnot since the beginning of the year, said the sources. It is selling 100000t of coal a month to Oakbay, one source said.

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