Coal South Africa

South African Eskom is facing coal shortages

South African Eskom is preparing to enter into short-term contracts by the end of this month to secure 3m tonnes of coal ahead of winter in the southern hemisphere. Eskom, which is a major power supplier in South Africa, is struggling to obtain coal supplies for 7 of its coal-fired power plants, which have reserves of on average 10-days of coal consumption. The company has already started to move surplus coal stocks from other coal-fired power plants to avert looming coal shortages. Eskom has also secured a reprieve from the National Treasury to circumvent the normal tender process to speed up coal purchases. The tender process normally takes 5 months to complete, however, the situation calls for emergency measures. The disruptions are linked directly to the plight of the business owned by the Gupta family, which fled the country in fear of prosecution on corruption charges. The two mines formerly owned by the Gupta family, Optimum and Koornfontein, are now up for sale by the state-appointed rescuers.

Pressure is mounting for the South African Eskom due to concerns about power shortages. The utility has dismissed rumours that slow supply to its 7 coal-fired power plants, which face critically low stocks may affect power generation in the coming weeks. The question remains whether the measures undertaken by the company will prove enough to avoid blackouts.


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