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Eskom denies leaked dossier claim

Apr 22 2010 07:40

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BHP BILLITON PLC [JSE:BIL]

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ANGLO AMERICAN PLC [JSE:AGL]

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Last Updated: 26-03-2015 at 04:18. Prices are delayed by 15 minutes. Source: McGregor BFA

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Johannesburg - South African power utility Eskom on Wednesday moved to dismiss claims of a leaked dossier, saying the document is no more than a "a normal monthly business report".

"Eskom would like to place on record that the so-called secret dossier that was leaked to the Democratic Alliance (DA) is an internal monthly business report which the company uses to track progress on its projects," Eskom said in a statement late on Wednesday.

"Whilst we accept that we need to be transparent, the disclosure of confidential information in this manner is irresponsible and could be prejudicial to third parties," it added.

The DA on Wednesday disclosed the contents of what it regarded as "a secret 291-page Eskom dossier", which the party said provided definitive proof, among other things, that Eskom has been charging vastly discounted electricity tariff rates to companies that provide little or no benefit to the South African economy.

The documents show that BHP Billiton (BIL), directly and through its subsidiaries, takes up 9.3% of all electricity generated by Eskom - making it the single biggest user of electricity in South Africa.

However, the DA said BHP Billiton only contributes an estimated 0.1% of Gross Domestic Product (GDP).

This is because the imported aluminium smelted at the Mozal, Hillside and Bayside smelters is exported directly after it has been processed.

"The document was leaked from high level officials in Eskom to the DA and we made use of its information yesterday to question the acting CEO in the portfolio committee on public enterprises," said Pieter van Dalen, the party's deputy spokesman on public enterprises.

Reviewing contracts

Eskom had previously said it was in the process of reviewing the contracts it has entered into with BHP Billiton and Anglo American (AGL).

"Eskom and BHP Billiton have agreed to amend their current long-term pricing agreements for the supply of power to BHP Billiton's Mozal smelter in Mozambique and their Hillside and Bayside smelters in South Africa," Eskom said.

The South African power utility has a back-to-back supply agreement with Motraco and Mozal, which means that what Eskom charges Motraco, Motraco charges Mozal.

Motraco is a company owned by the electricity utilities of South Africa, Swaziland and Mozambique. It owns the transmission network assets that supply electricity to the Mozal smelter in Mozambique.

"Anglo American is one of Eskom's large customers and the major part of their supply is on the standard tariff (Megaflex). However, the negotiated pricing agreement is with their Skorpion (zinc) mine in Namibia. Eskom and Anglo American have committed to re-engage before the end of April 2010," Eskom said.

Eskom said the information on the operational expenditure and pricing, as outlined in the report, is aligned to the information has been shared with the National Energy Regulator of South Africa.

- I-Net Bridge

anglo american  |  eskom  |  bhp billiton

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