Eskom has cancelled a contract with Exxaro Resources and will now buy coal for one of its power stations from a company soon to be under Gupta control.<\/p>\n
According to report by Bloomberg<\/a>, Eskom is buying coal for its Arnot power plant from a mine being bought by a company controlled by the Guptas – friends of South African president Jacob Zuma.<\/p>\n This follows the cancellation of a contract with Exxaro resources, the group reported.<\/p>\n Eskom reportedly cancelled the contract – which saw 20% of Arnot’s coal needs – as prices were too high.<\/p>\n Instead, Eskom will now get its coal from Optimum coal mines, which is in the process of being bought by the Gupta family-owned Tegeta Exploration and Resources.<\/p>\n The Sunday Times reported in September 2015 that Eskom went to “extraordinary lengths” to see that the Gupta family scored a R4-billion coal supply deal<\/a> from the parastatal.<\/p>\n Tegeta has reportedly agreed to pay R2.15 billion for the mining operation, which would cover most of the company’s R2.55 billion debt.<\/p>\n Tegeta moved to buy Optimum after current owner, Glencore, was forced to sell the loss-making operation due to restrictive Eskom contracts and billion-rand fines imposed on it by the utility.<\/p>\n Glencore and Optimum were under contract to supply coal to Eskom at R150 per tonne until 2018. The mining groups wanted a new contract with Eskom paying a cost price of R450 per tonne.<\/p>\n Eskom refused, and sought legal action against the mining group, imposing additional fines.<\/p>\n Gupta family scores R4-billion coal supply deal with Eskom<\/a><\/strong><\/p>\n Eskom has no backup plan after pulling coal supply deal<\/a><\/strong><\/p>\nMore on Eskom<\/h3>\n