EXXARO: 14,278 -333 (-2.28%)
South Africa's Exxaro looks to fill Eskom coal shortage
* Eskom faces coal shortages at 10 power stations
* Utility aims to finalise new contracts by end Oct
By Tanisha Heiberg
JOHANNESBURG, Oct 12 (Reuters) - South African miner Exxaro
Resources said on Friday it was looking to supply coal
to state-owned power utility Eskom, which has been hit by supply
shortages, posing a threat to the power supply in Africa's most
Eskom, which has fewer than 20 days of coal supply at 10 of
its power stations, supplies more than 90 percent of the
nation's power and is one of its most indebted state firms.
"We have made offers to Eskom, they have from what I hear,
approved those offers," Exxaro's chief executive officer Mxolisi
Mgojo told Reuters in an interview.
"The final decision is sitting with the (state) Treasury to
enable them to execute those contracts."
Eskom said last month it was trying to secure new contracts
with companies to ensure it had enough coal, after a major
supplier cut supplies and sought insolvency
Exxaro, which already supplies Eskom's Matimba, Matla and
Medupi power stations, aims to enter into short-term contracts
with Eskom, said Mgojo.
"We don't want to get involved in long-term 10-, 20-,
30-year type arrangements," said Mgojo.
"We want to create the flexibility whereby when the
opportunity makes sense for us to play short-term into the Eskom
market we have that flexibility to do that."
Eskom's spokesman Khulu Phasiwe said the power utility was
"very close" to signing new deals. He declined to confirm that a
deal with Exxaro was imminent.
"Hopefully before the end of this month we should be seeing
the first trucks coming through to the stations that are
affected," said Phasiwe.
Phasiwe declined to say who Eskom was negotiating coal
contracts with, only that it was talking to 12 companies.
"We are not in a position to mention them but some of them
include the main players in the market," Phasiwe said.
Eskom needs 3 million tonnes of coal to close its deficit
but was also looking to stockpile a further 10 million tonnes,
Eskom, which has a total national output of 45,000 MW,
implemented power cutting measures, known locally as "load
shedding", in 2015, denting economic output.
(Editing by James Macharia and Kirsten Donovan)
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