Molefe tells of Glencore ‘ransom’
Maligned former CEO of Eskom Brian Molefe began his evidence before the parliamentary inquiry into state capture on Tuesday night with a defence of Eskom’s dealings with Glencore, an explanation of his pension arrangements and a dismissal of allegations of his extensive contacts with the Guptas.
Molefe described how Glencore wanted to increase the price of its coal supply from its Optimum coal mine to Eskom’s Hendrina power station from R150 a tonne to R530. He did not support this at a time when Eskom was load shedding and was in a precarious position.
“Eskom and the country could not be held to ransom by a supplier of coal who was prepared to let SA suffer crippling power shortages to secure an increased price. The additional cost to Eskom of such an increase would have been in the region of R1.98bn per annum.”
In addition, Glencore wanted to have the penalties of R2.1bn for breaching contract terms waived. It decided to place its Optimum coal mine under business rescue, he said.
Optimum was then sold to Gupta-owned Tegeta Exploration and Resources, a subsidiary of the family owned Oakbay and the coal price and penalty obligations were maintained, Molefe said.
His statement did not deal with the controversy surrounding this sale, including the provision by Eskom of a R659m prepayment to Tegeta to facilitate it. It also did not deal with the Eskom guarantee of R1.6bn to Tegeta, which was arranged by suspended financial director Anoj Singh and presented as the prepayment for coal.
Dealing with the state of capture report by former public protector Thuli Madonsela, Molefe observed that she had not asked for his explanation for the numerous phone calls which he had allegedly made to the Guptas, “nor did she bring the phone records in her possession to my attention before she finalised the report”.
As Madonsela failed to provide phone numbers, dates and times the calls were allegedly made, Molefe said it was “difficult to determine the veracity of her claim”. from R150 per tonne — is how much Glencore wanted to raise the price of its coal, according to former Eskom CEO Brian Molefe