Eskom defends decision to use Gupta coal

Khulu Phasiwe says the contract was awarded because the company met its stringent measures.

FILE: The 'Sunday Times' reported that Tegeta Exploration and Resources had been trying to secure the deal since 2011 but was rejected because of substandard coal. Picture: Reinart Toerien/EWN.

JOHANNESBURG - Eskom has defended its decision to use coal from a company owned by the controversial Gupta family, saying tests were conducted and the coal is of good quality.

The Sunday Times reported that Tegeta Exploration and Resources had been trying to secure the deal since 2011 but was rejected because of substandard coal.

It claims the company was awarded the R4 billion contract to supply power stations over 10 years after a fifth test conducted on its coal found the product to be marginal.

Eskom however says this is not true.

The parastatal says the coal contract was awarded to Tegeta Resources and not the Gupta family, who only own a minority share in the company.

More importantly, the utility's Khulu Phasiwe says the contract was awarded because the company met its stringent measures.

But following a tip off last month that the company was supplying substandard coal they terminated the contract.

"We have taken a sample of their coal to our laboratory to see if they meet our specifications and just to make sure we took other samples to the South African Bureau of Standards."

The tests proved that Eskom was being supplied with good quality coal and the contract was therefore reinstated.