Eskom has confirmed it is buying coal for its Arnot power plant from the Optimum Coal mine, which is reportedly being bought by a company controlled by the Gupta family‚ saying it is “unapologetic about engaging with any supplier irrespective of ownership”.
It added it would fulfil its mandate and assess suppliers “only on their ability to provide coal on negotiated terms and conditions irrespective of any perceived political connections”.
The electricity provider said Optimum Coal was one of seven interim suppliers from which it was purchasing coal pending the awarding of a long-term contract to a new provider after deciding not to renew a 40-year contract with Exxaro Resources that expired on December 31 last year.
It added that it was unable to renew the cost-plus contract with Exxaro due to the “exorbitant” coal price, as well as the mine supplying below the contractual requirement.
“From 2012‚ Eskom proactively engaged with Exxaro on improving its performance. However, these efforts were unsuccessful. As such‚ the contract was allowed to expire as it was financially imprudent for Eskom to continue to purchase coal at their cost levels.”
The electricity parastatal added that following its standard tendering process‚ it had approached the open market in an effort to identify cost-efficient suppliers to provide coal to Arnot Power Station.
“The company has previously stated that this process would be completed in March this year and has all intentions of completing by this date. As such‚ the process has not yet been finalised and therefore no contract has been awarded; any speculation contrary to this is therefore incorrect and mischievous‚” Eskom stated.
Eskom’s group executive for generation Matshela Koko said: “In order to ensure business continuity of Arnot‚ Eskom has responsibly sourced coal from seven interim suppliers. These interim suppliers will ensure security of coal supply pending the conclusion of the long-term contract. One of these suppliers is Optimum who has provided less than 15% of the coal delivered to Arnot in January.
“All interim suppliers deliver coal significantly below the previous Exxaro price – further demonstrating the correctness of Eskom’s decision to seek a new supplier.”
Koko added: “Eskom is in no way involved with transactions relating to the ownership of coal mines and is solely focused on procuring coal of the required quality to Eskom’s power stations‚ at the right time and at optimal cost”.
Koko said he was dismayed by accusations regarding any purchase of coal from Optimum due to an ownership change to Tegeta‚ the company reportedly being bought by the Gupta family.
Eskom ‘unapologetic’ about Gupta coal
It added it would fulfil its mandate and assess suppliers “only on their ability to provide coal on negotiated terms and conditions irrespective of any perceived political connections”.
The electricity provider said Optimum Coal was one of seven interim suppliers from which it was purchasing coal pending the awarding of a long-term contract to a new provider after deciding not to renew a 40-year contract with Exxaro Resources that expired on December 31 last year.
It added that it was unable to renew the cost-plus contract with Exxaro due to the “exorbitant” coal price, as well as the mine supplying below the contractual requirement.
“From 2012‚ Eskom proactively engaged with Exxaro on improving its performance. However, these efforts were unsuccessful. As such‚ the contract was allowed to expire as it was financially imprudent for Eskom to continue to purchase coal at their cost levels.”
The electricity parastatal added that following its standard tendering process‚ it had approached the open market in an effort to identify cost-efficient suppliers to provide coal to Arnot Power Station.
“The company has previously stated that this process would be completed in March this year and has all intentions of completing by this date. As such‚ the process has not yet been finalised and therefore no contract has been awarded; any speculation contrary to this is therefore incorrect and mischievous‚” Eskom stated.
Eskom’s group executive for generation Matshela Koko said: “In order to ensure business continuity of Arnot‚ Eskom has responsibly sourced coal from seven interim suppliers. These interim suppliers will ensure security of coal supply pending the conclusion of the long-term contract. One of these suppliers is Optimum who has provided less than 15% of the coal delivered to Arnot in January.
“All interim suppliers deliver coal significantly below the previous Exxaro price – further demonstrating the correctness of Eskom’s decision to seek a new supplier.”
Koko added: “Eskom is in no way involved with transactions relating to the ownership of coal mines and is solely focused on procuring coal of the required quality to Eskom’s power stations‚ at the right time and at optimal cost”.
Koko said he was dismayed by accusations regarding any purchase of coal from Optimum due to an ownership change to Tegeta‚ the company reportedly being bought by the Gupta family.
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