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Eskom won't budge on coal deal with Glencore: CEO

Nov 17 2015 17:34
Peroshni Govender, Tiisetso Motsoeneng and James Macharia

Johannesburg - Eskom will not pay Glencore's SA unit more than R150 a tonne when a temporary coal contract ends on November 30, says the utility's chief executive, Brian Molefe.

"A contract is a contract," Molefe told Reuters in an interview on Tuesday, referring to the agreement Eskom has with Glencore's Optimum mine.

Under that contract, Optimum provides Eskom with 10 million tonnes a year at R150 a tonne, a rate the company says is less than the cost of production.

In previous contracts with coal suppliers, the utility paid for the running costs of mines for a guaranteed supply of coal at a pre-determined price, which Molefe said was not sustainable.

Eskom's fleet of coal-fired power stations produce virtually all the electricity in Africa's most industrialised economy.

brian molefe  |  johannesburg  |  eskom
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