Eskom clarifies Tegeta prepayment

 The money paid to Tegeta was not a loan but a prepayment, Eskom said at the weekend.

“Eskom finds the assertions that the prepayment made to Tegeta ‘was a loan’ pure nonsense. It is based on no facts but fiction,” said the power utility in a statement.

This followed a media report alleging that a leaked draft Treasury document indicated that the prepayment should be converted to a loan with interest.

“The Tegeta prepayment request was considered on its merits when there were security of supply risk during the height of load-shedding. Eskom received value for money in that coal was delivered as agreed in terms of the agreement,” said the power utility.

Conditions relating to the prepayment included a 3.5% prepayment discount on the coal price and sufficient security guarantees, which included the pledging of Tegeta shares.

The power utility said Internal Audit has also confirmed that the full amount of the prepayment to Tegeta has been recovered via coal delivered to Eskom by the end August 2016.

“During this period of time, Eskom had sufficient security in place to cover any potential default by Tegeta. Given the fact that the prepayment was recovered, it remains a grave concern that perceptions continue that a supposed ‘liability’ still exists,” said Eskom.




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