Why Molefe is a threat

“Molefe has just been too good for Eskom and the country and frankly, the majority of white South Africans with their black lackeys-in-tow including the media are not happy. A performing Eskom also defeats the campaign to privatise state owned entities (SOEs) and on that level too, he must be harangued.”


Pinky Khoabane


More importantly, Molefe is not prepared to continue what the power utilitys chairman, Ben Ngubane, called the extortion of Eskom by white-owned coal-mines which signed 40-year contracts during apartheid and at exorbitant rates. Hes rattling white monopoly capital and like everyone who has done so, he will be crucified. The top four coal suppliers are Anglo, Exxaro, South 32 and Glencore and we know, some werent able or were unwilling to meet their contractual obligations to Eskom. South Africans view these 40-yr contracts as legitimate. I would like to see their reactions if Molefe were to give any black-owned company a similar contract.

But lets look at the figures. Exxaro for example. It benefitted from a 40-year cost-plus contract for supplying the Arnot power station in Mpumalanga. This means the taxpayer guaranteed Exxaro a fixed profit for decades instead of the hard work companies must put in to get a profit. Exxaro charged R1200 per tonne in comparison to Tegetas R475 per tonne saving the taxpayer over R1 billion per year. If Eskom had utilised services of other mining companies over the 40 years, it would have saved R40 billion.

Molefe has just been too good for Eskom and the country and frankly, the majority of white South Africans with their black lackeys-in-tow including the media are not happy. A performing Eskom also defeats the campaign to privatise state owned entities (SOEs) and on that level too, he must be harangued.

The terms of the $850 million IMF loan the ANC government took in 1993 included the privatisation of SOEs and commitment to abandoning nationalisation. There has been a concerted effort from the shrewd business people to privatise these assets but the labour movement has put pressure on the ANC not to do so.

The leadership of some of these entities have also sadly, given their enemies the weapon.

Under Molefe, the dreaded intermittent power cuts have come to a complete halt. The words loadshedding, Eishkom and all the jokes that had become the opening lines on every radio station and at every social gathering have come to an end.

The Eskom standoff with one of its long time suppliers of coal, Glencore, speaks volumes and suggests some of the loadshedding may have been deliberate in order to force Eskom to pay it more for its coal.

Last year, Glencore tried to negotiate an increase from R150 per ton to R530 per ton for the supply of coal and Eskom refused on the basis that the Swiss mining and trading company had a contract ending in 2018, by which it had to supply coal to Eskom at the R150 per ton.

The power utility fined Glencore for not meeting its contractual obligations following four months of intermittent power outages. In what could be read as a subtle threat, Glencore said there would be more power outages if it didnt supply the coal to Eskom. Following the fine, Glencore put its mine Optimum, which was supplying Eskom with the coal, under bankruptcy. Jobs would have been lost but the mine was sold to Tegeta Exploration & Resources. The Gupta family owns 29% of this company.

Tegeta is one of several companies which took-over the Glencore contract. It has now emerged that Eskom gave this company a pre-payment of approximately R500m. Is this a unique practice to the Gupta company? Eskom says it isnt. It says it is used widely particularly in large projects, coal mining contracts and emergency supply contracts.

I have yet to read a rebuttal of this assertion. But we must ask ourselves why Tegeta was the only company targeted among the many smaller businesses from which Eskom now buys coal? The many questions of how the Guptas secured the money to buy the mine are not being asked of the others.

In a parliamentary committee on Wednesday, Molefe was quizzed at length about his relationship with the Guptas and like everyone who awaits criminal charges to be lodged against the them, he asked what it is they have done and why cant he do business with them.

Law binds Eskom, not Gupta family  – Molefe

The South African power utility, Eskom, follows the rule of law when
it awards tenders to whoever applies for a tender to supply coal,
not that they are being captured by the Gupta family. That’s according
to Eskom boss Brian Molefe who was speaking on Wednesday in Parliament.

Molefe was answering to Parliament’s public enterprise committee
whether the state utility has been ‘captured’ by a company owned by the
Gupta family.

It was reported recently that the Gupta owned company is only responsible for 5% of all coal supplied to Eskom and the rest is supplied by the other companies that are not owned by the family. Less than 1% of the family’s revenue comes from government tenders.

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Eskom has recently come under attack over its transaction with Tageta Coal which recently bought the Optimum Glencore mine which supplies coal to the Arnot and Hendrina power stations.

“Not to do business with Tegeta would require us to blacklist the company,” said Molefe.

“We would have to inform them that we can’t do business with them and provide reasons,” he told Parliament on late Wednesday.

“Until we can give reasons to blacklist them, if they bid for a transaction and apply for a tender, we have to consider”.

He said he didn’t want to break the law by blacklisting the company owned by the family without reasons.

“By saying so, if that makes me a captured person, I’m captured by the Constitution,” Molefe said.

(edited by MM)