Alleged awarding of coal tender to Gupta-owned company defended


Power utility Eskom has slammed weekend reports that it “blindsided” minerals and coal mining company, Exxaro, by awarding a coal tender worth a reported R564-million to a company owned by the controversial Gupta family and President Jacob Zuma’s son Duduzane.

On Sunday, CityPress reported that the state-owned parastatal quietly paid the amount to Tegeta Exploration and Resources through its mining division Optimum Coal in April, to supply the Arnot Power Station in Mpumalanga with 1.2-million tons of coal for six months.

The paper also claimed that the amount, when supplemented with transport costs, came to just under R700-million, and that the main shareholders included Gupta-owned Oakbay Investments, Duduzane’s Mabengela Investments, Elgasolve owned by Gupta associate Salim Essa and two unknown investors from Dubai.

It further alleges that the contract with Exxaro, which expired at the end of last year, had been delayed to give Tegeta enough time to prepare for the bid, and that Eskom was allowing a large portion of coal to be diverted from the Hendrina Power Station to Arnot at a higher price per ton.

In a statement, the utility said the paper not only failed to support its “sensationalist headline” with “wild allegations”, but that it blindsiding Exxaro was “baseless, malicious and misleading”.

“CityPress has deliberately downplayed the fact that Exxaro had a 40-year contract with Eskom for the supply coal to the Arnot power station. The contract was not cancelled as has been insinuated, it actually expired at the end of December last year,” Eskom said.

It also stated that the diversion from Optimum coal mine to Arnot was mainly due to the grade of export coal being unsuitable for Hendrina, and that there is nothing suspicious about Tegeta selling coal to Arnot.

“Whilst the evaluation of the long-term contract are still underway, Eskom has in the interim contracted seven suppliers to deliver coal to Arnot until September. Although the media has generally focused on one supplier, Tegeta, Eskom has named the other six suppliers as well.

“In April, four of the seven suppliers remained supplying Arnot… this information was provided to CityPress with details of how much coal had [been] supplied for the month of April. CityPress chose not to use this information it would stand in the way of their scoop. It is for this reason that we’re considering taking the matter to the Press Ombudsman for adjudication”.

The Democratic Alliance (DA) has meanwhile said it would be approaching Public Protector Thuli Madonsela to investigate the contracts it claims unduly benefits the Guptas Zumas.

“This is yet another development in the string of “under the table” relations between the State, the Gupta family, and the Zuma family,” DA leader Mmusi Maimane said in a statement.

“For the sake of completeness, the Public Protector’s investigation into the Gupta family and its relationship with President Jacob Zuma ought to include the long-standing and complicated relationship between Gupta-owned companies and Eskom. South Africa cannot afford to have the Gupta family using the South African government to further their own business interests”.