Under fire Eskom gets first tranche of R6.5 billion loan
The utility received promised R1.5bn loan from French development agency to invest in its transmission system
STRUGGLING state-owned entity Eskom has received the promised R1.5 billion loan from the French development agency to invest in its transmission system along the mineral-endowed West Coast.
The loan from the Agence Française de Développement comprises the first tranche of a R6.5bn multitranche loan facility signed last March.
The first tranche will be dedicated to financing of the Namaqualand Strengthening Phase 2: Juno Gromis Project, aimed at boosting the power network in the Northern Cape, integrating renewable energy sources and, ultimately, facilitating cross border transmission.
Eskom chief executive Phakamani Hadebe said yesterday that the transmission system was important to deliver electricity from the power stations to distribution centres across the country.
“This multitranche loan facility will contribute to Eskom’s plans to strengthen and refurbish the transmission infrastructure while diversifying our funding structures,” Hadebe said.
The utility’s primary energy division general manager, Dan Mashigo, said yesterday that the company had 28 days of coal stockpiles and had hit rock bottom in terms of coal stock decay. He painted a bleak picture, saying the utility’s cost-plus mines, in which it paid operational costs, as well as the Gupta-owned mines that have been under business rescue since February, had contributed to load shedding.
“The five cost-plus mines have not performed to their historical levels, or the 55 million tons-a-year they are contracted to produce. We are not getting the contractual output from our cost-plus because we did not capitalise the mines on time.”
Mashigo also said that three Gupta-owned mines, which had been placed in business rescue, coupled with fierce competition from the seaborne market, including India and Pakistan, had contributed to load shedding.
He said the mines had added salt to the wound as the company had suffered a shortfall of 5.7 million tons as of October, due to the business rescue process. “This amounts to 15 days of stockpiles. If these mines were producing, we would have far more than 28 days of supply available,” he said.
Project Halo reportedly submitted a R3.05bn winning bid for Gupta-owned Optimum Coal Mine, Optimum Coal Terminal and Koornfontein Mines held by Tegeta Resources and Exploration.
The company had signed 35 contracts as at the end of last month to provide Eskom with 94 million tons, including 18 million tons this year, he said.
Eskom, which supplies 90 percent of the country’s electricity needs, said yesterday that the chances of load shedding during the festive season would be low.