Johannesburg – A businessman from Mpumalanga takes on Eskom and calls for his company to be reinstated after discovering that the electric utility used his information in court documents against former executives when his contracts were canceled.
Coal tycoon Joe Singh of the Joe Singh Group of Companies has been embroiled in legal battles with the electric utility as he tries to reinstate contracts that were allegedly illegally canceled. The fight between the two escalated when the electric utility and the Special Investigations Unit (SIU) brought former Eskom leaders to justice.
In their court documents, Eskom and the SIU referred to an email from Just Coal, one of Singh’s companies, to Eskom discussing the decision to terminate the deal. The email was reportedly leaked by Matshela Koko to members of the Gupta family. At the time, they were direct competitors of Just Coal in the coal sector, supplying coal to Eskom through their Optimum Mine property in Tegeta.
Despite the existence of such documents and evidence the electric utility now relies on to recover more than R3 billion from former executives, Eskom still refuses to reinstate Joe Sign Group contracts.
Company attorney Mfundo Shabangu said engagements with Eskom had had little success.
“Eskom has recognized the injustice caused by the corruption perpetrated against the Group and its subsidiary, Just Coal. Yet they continue to avoid us and treat us the same as their corrupt predecessors. Eskom unequivocally admits in his own court documents that Matshela Koko indeed illegally orchestrated the termination of the Just Coal coal supply agreement in order to exert financial pressure not only on Just Coal but on the entire Group of Joe Singh companies, the first of which is a subsidiary. Shabangu said.
Shabangu added that based on the bids made by Eskom, Koko’s plan was designed to financially cripple the Joe Singh Group, preventing them from bidding on and acquiring Optimum Coal Mine, in favor of the Guptas.
“What followed were billions of rand losses for the Joe Singh group, because their contracts were terminated or the agreements were not honored by Eskom. Eskom has always denied the existence of a conspiracy and has always maintained that any action taken against the Joe Singh group is above the table. However, Eskom has now found himself with his tail between his legs, having pointedly admitted the plot in his court documents, ”he said.
Koko this week declined to comment, saying the case was up to the courts.
Eskom spokesperson Sikonathi Mantshantsha declined to comment on the question and answer specific questions. He said: “Since the case is currently sub judice, Eskom will not be making any comments outside of court proceedings.”
The fight between the group and the electricity company began in 2015 when Eskom gave formal notice to cancel a 10-year contract with the group. Shortly after, the electric utility declared a coal shortage, which caused a deviation from the normal supply process and the coal was purchased at higher prices.
The group was subsequently taken to court, and in November 2016 Eskom brought criminal charges of fraud against a subsidiary of the Joe Singh Group, Just Coal.
“The company had a 10-year coal supply contract with Eskom, which was in its third year. Eskom alleged that they had received information from an informant that Just Coal was supplying substandard coal to the Tutuka power plant, in breach of the terms of the contract. The investigation lasted three years and the prosecutor found no evidence to support the allegations, ”Shabangu said.
In March of this year, Judge Lindiwe Vukeya ruled in favor of the group and ordered Eskom to honor the broken contract. Despite this, the contract was never reinstated.