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Eskom gives in to Treasury on coal report

Cape Town - Eskom indicated that it will hand over information required by the Treasury, which is investigating the utility's coal contracts.

"We will submit the information even though the board has not sat down to formally consider the outcome of the report," spokesperson Khulu Phasiwa told Talk Radio 702.

This followed a call by Public Enterprises Minister Lynne Brown asking the power utility to immediately release the information to Treasury.

Phasiwa said a driver had been dispatched to deliver the documents to the Treasury.

"After our discussions this morning with the Public Enterprises Minister, the decision was we would submit the information (to Treasury)".

Brown expressed concern on Tuesday that credit rating agencies could downgrade Eskom because of a spat in the media with Treasury.

The Treasury on Monday accused Eskom executives of blocking the probe, but Eskom said it was cooperating in the investigations.

Eskom said on Monday it was "shocked and perplexed" after Treasury said it has failed to honour its undertaking to submit comments to Treasury’s review of Eskom's coal contracts.

"National Treasury started an investigation into Eskom contracts with Tegeta in July 2015," Eskom said in a statement on Monday. "Eskom wants to reiterate that it has been cooperating with National Treasury. Since then ... Eskom has been responding to National Treasury requests."

Democratic Alliance MP David Maynier said on Monday that he would request Eskom CEO Brian Molefe to report to the standing committee on finance after Treasury said Eskom had chosen to ignore correspondence and put all forms of hindrances to prevent the review from occurring.

He accused Molefe of protecting Tegeta’s owners, the Guptas, who revealed this weekend that they are selling their shares in the business.

Maynier revealed last week that Tegeta had threatened Treasury with legal action over releasing its draft report into its coal contracts with Eskom to Maynier.

Treasury said on Monday that it was surprised by media reports of Tegeta “warning” and threatening to interdict the department should it release a report into its investigation of Eskom’s coal contracts.

READ: Gloves off as Treasury takes swipe at Eskom

In legal letters to Treasury seen by Fin24, Tegeta said the coal report was still in a draft format. “Any disclosure thereof will severely prejudice our client …,” Tegeta’s lawyer said on July 13.

The draft report – which the Sunday Times leaked this weekend – reveals that Eskom paid over R130m to Tegeta for coal it could not use.

“The report … shows that Eskom signed a coal supply deal with Tegeta Exploration and Resources for a commodity they both knew was out of specification,” the Sunday Times explained. “The 10-year contract is worth R400m a year.”

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