Eskom says coal supply problems linked to Tegeta

Johannesburg - Eskom is working with the National Treasury to source more coal for seven of its plants that don’t have adequate supply.

The state power utility is diverting coal to the under-resourced stations from facilities that have sufficient supply, spokesperson Khulu Phasiwe said on SAfm. The supply problems stem from mines run by Tegeta Exploration and Resources, he said.

“There are some difficulties - that’s the situation they’re managing now,” Phasiwe said of Tegeta.

“From our side, we’re looking for a replacement supplier as soon as possible to make sure we don’t go back to the days of loadshedding, especially as we’re going into winter,” he said, using a local term for rolling blackouts, which the country was forced to implement in 2015 after seven years of power shortages hindered economic growth.

Tegeta is a company controlled by the politically connected Gupta family through Oakbay Investments and a son of former President Jacob Zuma. In December 2015, it bought Optimum, which includes a mine of the same name, the Koornfontein operation and a stake in Africa’s biggest coal-export terminal, from Glencore [JSE:GLN].

Oakbay said in August that it agreed to sell Tegeta for R2.97bn to Swiss company Charles King SA. The disposal was expected to be concluded in 12 months, Oakbay said at the time.

* Sign up to Fin24's top news in your inbox: SUBSCRIBE TO FIN24 NEWSLETTER