After driving Optimum Coal into business rescue last year, thereby endangering almost 2 000 jobs at the mine, Eskom suddenly reached a settlement that gave the Gupta family a 75% discount on the R2.1bn fine it had levied on the company at the time it was owned by global commodities trader Glencore. Business Day says in March this year, Eskom agreed to accept a R500m settlement for the non-performance penalties it had levied on Glencore.

The agreement was reached after Eskom issued Glencore a summons demanding the payment of the fine for what it said the was the miner’s failure to deliver suitable coal for the Hendrina power station. This was despite Eskom’s initial stance that it would not negotiate with Glencore and would recover every cent of the penalty.

At the time, in September 2015, then Eskom CEO Brian Molefe vowed Eskom would not enter into discussions with Glencore or Optimum. ‘We want our money and we will recover all of it,’ said Molefe. This hard stance caused Glencore to place the company in business rescue, threatening the jobs.

The business rescue practitioners put the company up for sale, and the Gupta family, through its Oakbay Resources & Energy commenced negotiations to buy it. Eskom’s hard stance continued throughout the sale process. The Guptas took over the company last year, after which Eskom then became willing to negotiate on the R2.1bn penalty.

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