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South Africa’s North High Court Sets Aside Tegeta Coal Supply Contract with Eskom

Coal News - Published on Tue, 25 Feb 2020

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Tegeta's ZAR 3.7-billion coal supply contract with Eskom has been declared invalid by the North High Court after the Special Investigating Unit obtained a court order to set aside the contract. SIU spokesperson Kaizer Kganyago says the court has also given the green light for the unit to institute legal proceedings against the formerly Gupta-owned company.

The Tegeta agreement was signed in March 2015 andt stipulated that Tegeta would supply coal to Eskom's Majuba power station for 10 years. The contract was not entered into in accordance with the supply-chain management of Eskom and the required permissions were not granted.

An SIU investigation into the allegations of maladministration at Eskom was ordered in 2018.

Tegeta sprung into prominence when former public protector Thuli Madonsela detailed Eskom’s involvement, allegedly at the behest of the Guptas in making the sale of the Optimum Coal Mine to Tegeta possible at the expense of Glencore. Tegeta stopped trading during 2018, but owns shares in the Richards Bay Coal Terminal, as well as the Koornfontein Coal Mine, and Shiva Uranium. Oakbay owns a 59% stake of Shiva Uranium, another mine under business rescue. Tegeta was placed under business rescue and practitioners handling the company were at the time trying to recoup R4 million from Oakbay.

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Posted By : Rabi Wangkhem on Tue, 25 Feb 2020
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