Captured – and held to ransom

It is outrageous that the Gupta-owned company, Tegeta Mining and Resources, can try to blackmail Eskom to get more money for the coal it supplies to the Hendrina power station. The amaBhungane investigative unit reported yesterday on an Eskom board meeting last Friday in which the apparently extortionate conduct was discussed.

According to the report, Optimum Coal, which is owned by Tegeta, has been refusing to deliver the quantity of coal it is contractually bound to, to the power station. The result is that the coal stocks at the power station were reduced to dangerously low levels, raising the prospect of power outages.

According to amaBhungane, Optimum and Tegeta are unhappy with the R150 per ton they are paid for the coal, which they agreed on when they signed the contract.

That is particularly galling to ordinary taxpayers, who have to foot increasingly high electricity charges from Eskom, because the power utility had pushed through a “sweetheart” deal enabling the Gupta family and its associates to buy Optimum from Glencore in early 2016.

That deal saw Eskom pay an upfront amount of almost R600 million as an advance payment for coal from Optimum. This was almost the exact amount Tegeta was short on the Glencore asking price of R2.15 billion for the mine.

The mine originally went into business rescue because it could not sustain profitability on the R150 a ton being paid by Eskom for its coal. Now, it is alleged Optimum has been exporting some of its coal at premium prices, while neglecting its captured partners.

How long must we allow this gang to abuse our stateowned enterprises?

When a state is captured, that is bad enough, but when it is also threatened, surely it is time to say: enough is enough.