Guptas and midnight contracts castigated in Eskom shake up

It didn’t take long for the name of the notorious Gupta brothers – who once made millions selling coal in South Africa with questionable contracts – to be dragged into the big shake up at Africa’s biggest power generator.

The brothers left South Africa, this year, after two decades of business in South Africa that garnered them a multi-billion rand fortune. Their critics claim they used political influence to secure many of these contracts to supply coal to Eskom from their operations under Tegeta Resources at premium prices at the last minute to ease shortages.

“It (Eskom) would sign midnight contracts with Tegeta to get coal pre-payments of hundreds of millions of rand that were given. There would be teleconferences to make sure the Guptas got the deal,” says Pravin Gordhan the minister of public enterprises.

“The idea was to squeeze everyone else out of the market and make the Guptas dominant. Now they (Eskom) are telling us it takes a year to sign such contracts. There is something wrong in this kingdom, so to speak.”

Gordhan also said he was concerned about the cost of diesel to run Eskom’s emergency open cycle gas turbines that are used to prop up the grid. He said a team of independent advisers were going to look at this cost.

“They were spending a billion rand a month to keep the lights on” There has to be a use of diesel but it is something you want to minimise.”

The Guptas left for Dubai earlier this year and most of their businesses have been sold off or liquidated.

Partner Content

An Innovative Approach is what will save us

Charmaine Mabuza, Group CEO of ITHUBA Holdings Every functional business has business continuity plans...

Standard Chartered and Airtel Africa form a partnership to drive financial inclusion across Africa

Dubai, United Arab Emirates / London, United Kingdom – 13 August 2020: Standard Chartered Bank and Airtel Africa have today announced a...

THE FUTURE JUST ARRIVED: THE ROLE OF BANKS IN A POST-COVID WORLD

THE COVID-19 GLOBAL pandemic has brought forward the future. It has brought about humanity’s biggest challenge in a century, to choose between...

Subscribe to our newsletter

Sign up for free newsletters and get more CNBC AFRICA delivered to your inbox

- Advertisement -