On Tuesday, South African state-run power utility Eskom, announced the cancellation of a coal supply contract to its Tutuka Power Station due to quality control.
According to the utility, following the strict monitoring of the coal quality of all its suppliers delivering coal to its Tutuka Power Station, it became evident that main coal supplier, Just Coal CC, was consistently supplying inferior coal.
Breach of coal supply contract
According to the parastatal, after numerous site visits to the contracted collieries, it was determined that coal supplied to the Tutuka Power Station by Just Coal CC was not extracted from the contracted collieries.
Matshela Koko, interim group chief executive commented: “This is in breach of its contractual obligations to Eskom. The result is that Eskom is burning an unknown combustion characteristic coal resource at its Tutuka Power Station, potentially resulting in load losses.”
Koko added that in an effort to resolve the issue, Eskom has requested technical information such as mine layouts and in situ coal qualities from Just Coal CC. Read more…
“The information provided did not adequately address Eskom’s concerns,” Koko noted.
He added: “On 16 March 2017, we had placed Just Coal in breach of its contractual obligations and requested additional technical information. We then afforded them until 23 March 2017 to provide the technical information and remedy the breach and they failed to do so.
“Eskom is intolerant of any deviations from the prescribed standards and processes. This, quite plainly, amounts to corruptions, which we cannot condone in any part our business.” Read more…
“As a state entity, there is an innate expectation to be prudent and corruption-free in how we conduct our business,” concluded Koko.
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