Zondo commission to hear how the Guptas nabbed their Optimum coal mine

The Zondo commission of inquiry into state capture will on Wednesday hear details about the Gupta family’s controversial acquisition of the Optimum coal mine, which was nabbed from mining company Glencore with the help of a large prepayment from Eskom.

Former Glencore chief executive Clinton Ephron will take the stand on Wednesday and is expected to outline how the company was pressured into selling the Optimum coal mine to Gupta-linked Tegeta.

Tegeta was assisted in buying the coal mine by Eskom using the R659-million pre-payment. The pre-payment by Eskom, which was paid just three days after a late-night special board tender committee resolution to pay it, helped the Guptas’ with their mine.

Without that resolution the infamous Gupta family, which had been denied loans by banks just hours before, would have missed the deadline to deposit the R 2.1-billion required to conclude the transaction.

National Treasury’s damning report on alleged corruption at Eskom found that the power utility’s management prejudiced Glencore by refusing to sign a negotiated coal contract, giving an advantage to Tegeta to acquire all assets in Optimum coal mine.

The report also found that Eskom prejudiced Glencore by fining Optimum coal mine R2.1-billion for allegedly supplying poor-quality coal to the utility. The penalties led to Optimum coal mine going into business rescue.

Treasury’s investigators also found that Eskom failed to levy any penalties against Tegeta’s Brakfontein mine for supplying the utility’s Majuba power station with dodgy coal.

According to the report, former Eskom executive Matshela Koko paved the way for Tegeta’s acquisition of the allegedly loss-making Optimum coal mine.

In November last year, former minister Ngoako Ramatlhodi told the Zondo commission that he was sacked as mining minister by former president Jacob Zuma in 2015 for refusing to aid the Guptas in their efforts to buy Optimum Coal Mine.

Ramatlhodi alleged that Eskom’s then chair Ben Ngubane demanded that he take away Glencore’s mining licenses under the guise that the company owed Eskom R2-billion, a decision which would have jeopardised the country’s electricity supply.“When I got out, a Gupta minister came in,” Ramatlhodi said, referring to Mosebenzi Zwane’s appointment as mining minister.

Zwane’s alleged involvement in Tegeta’s acquisition of Optimum coal mine will be a key element of the Zondo commission’s probe, evidence leader Vincent Maleka SC said last week.

The allegation that Zwane helped seal the deal on the acquisition on a trip to Glencore’s Swiss headquarters in Zurich was contained in former public protector Thuli Madonsela’s State of Capture report.

Sarah Smit
Sarah Smit
Sarah Smit is a general news reporter at the Mail & Guardian. She covers topics relating to labour, corruption and the law.
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