Eskom ‘misled’ treasury over multi-billion rand Gupta contract

Eskom appears to have misled national treasury about the quality of coal from a Gupta-owned coal mine in order to secure a R2.9-billion contract, the Zondo commission of inquiry into state capture has heard.

On Monday, the inquiry — chaired by Deputy Chief Justice Raymond Zondo — continued with evidence from Gert Opperman, a coal supply unit manager at the power utility.

Opperman took over the management of the coal contract at Brakfontein colliery in Mpumalanga in April 2015.

The colliery was owned by the Gupta mining company Tegeta Exploration and Resources.

Opperman testified that in 2016 Eskom and Tegeta wanted to increase the amount of coal that Brakfontein supplied to Majuba power station.

Opperman previously testified that there had been problems with the quality of the coal from Brakfontein, which had a relatively high sulphur content.

He also testified that in 2015, he twice received phone calls from former Eskom executive Matshela Koko instructing him to accept the sub-standard coal that was not compliant with the contract.

At the coal face

In 2016 ,an area called “Brakfontein extension” — which was situated across the road from the established Brakfontein colliery — began to be mined.

Opperman told the Zondo commission, however, that the tests on the coal proved that it was of low quality. The results were shared with the commission.

In response to question by the evidence leader, Opperman confirmed that the power utility’s internal tests showed coal should not be relied on for any power station.

But Eskom — when writing to treasury for leave to increase its contract with Brakfontein in terms of securing additional coal at a cost of R2.9-billion (a 77.4% increase over the initial contract) — said the coal from the extension had in fact passed quality tests.

Opperman, who said he was not involved in talks or negotiations around the contract, said in his understanding the coal had not passed required quality tests.

He also told the commission that he and colleagues had in 2015 organised an audit for the quality of coal from Brakfontein, only to learn from his superiors that the audit had been cancelled. — Fin24

Jan Cronje
Jan Cronje
Fin24 Journalist based in Cape Town.
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