My sin was that I refused to be bullied by white people — Molefe
● Former Eskom CEO says he is under the spotlight at state capture inquiry because he stood up to powerful suppliers
A former Eskom chief executive is under the spotlight at the state capture inquiry because he stood up to bullying by white-owned coal suppliers.
This is the testimony of Brian Molefe, who appeared before the Zondo commission in Braamfontein yesterday.
Quizzed about why Eskom dumped Glencore-owned Optimum Coal Mine and Exxaro in favour of Gupta-owned Tegeta, Molefe said that the two companies — which had 40-year contracts with the power utility — had been strong-arming the state-owned enterprise with impunity and he had stopped them.
Molefe said that he, unlike other Eskom chief executives who came before him, was not scared of white people.
This was why he was determined to stop Optimum and Exxaro in their tracks, as the two companies were whiteowned.
“Why buy coal for R500 when you can get it for R450?
“There is a man in Newcastle who asked minister Bheki Cele the other day nibasabani abelungu [why are you scared of white people]?” Molefe said.
He was questioned about why Eskom had terminated a coal-supply contract with Exxaro in December 2015, only for it to be given to Tegeta.
According to the commission, Exxaro had been supplying coal to Eskom at more than R600 a ton.
But Molefe told the commission that the company was demanding a price hike to R1,300 a ton if its contract was renewed in 2016.
Furthermore, he said, Exxaro wanted Eskom to buy a piece of land for it to start a new coal mine.
Eskom, under his stewardship, he said, refused to bow to these “unreasonable” demands.
Molefe said the coal supply to Eskom by “cost-plus mines” was daylight robbery, which was designed to bankrupt Eskom.
He said he was determined to stop this during his time at Megawatt Park.
Cost-plus mines, he said, were a phenomenon of mines such as Optimum that were funded by Eskom to mine and supply coal to the power utility.
According to Molefe, this business practice was bogus and detrimental to Eskom.
“It is like when you want bread. You fund someone to start a bakery which will produce the bread that they will supply to you,” he said.
Molefe said Eskom needed to disabuse itself of evergreen contracts with a “few whiteowned companies who control coal supply to squeeze Eskom”.
If it were up to him, Molefe said, the coal-supply space would be opened up to many black-owned small and medium enterprises to create competition and ease Eskom’s financial burden.
As for Optimum, Molefe said no-one pressed it to sell to the Guptas as his only issue was opposing its request to increase coal prices from R150 to R440 a ton.
“I refused to be bullied into acting against the interests of Eskom.
“They sold the mine to the Guptas on their own accord,” he said.