By BO Staff Writer
The coal mining company, Exxaro Resources, has announced that it approved a transaction which would result in its majority black ownership stake declining from 50% to 30%. Exxaro is Eskom’s largest coal supplier and has 50.19% black ownership under the company, Main Street 333 Proprietary Limited.
The 30% ownership level is below the 50% Eskom requires from its coal suppliers under its coal procurement policy.
Eskom’s acting chief executive Matshela Koko reacted on twitter by saying, “So Exxaro decides to show @Eskom_SA a finger instead of radically transforming and has no decency to even engage on this matter.”
— Matshela Koko (@koko_matshela) January 2, 2017
Exxaro and pro-market, neoliberal analysts say the current BEE scheme is “unsustainable” and “would require finding a partner able to invest about R16.4bn” to the company.
“What is actually happening is that the ongoing legacy of the pre-1994 economy is being confronted by the Eskom leadership. This is the legacy that we have not worked hard enough to dismantle, and at times have been frightened to confront. Eskom has resolved to do something radically different,” Koko said in December.
In 2015 Eskom pushed ahead with it’s 50% procurement policy, which undermines the Mining Charter which requires coal mining companies only have 26% Black ownership.
The mining industry in South Africa is dominated by old-guard, white companies which react every time their monopoly is threatened. Eskom’s progressive 50% procurement policy is “a thorn” to the white coal suppliers, Koko previously said. In 2015, Citypress reported that “half of the 33 [Eskom] contracts are with the five major companies and make up 80% or so of annual purchases by volume: Exxaro, Anglo American, BHP Billiton (South32) and Glencore.”
It is reported that Eskom will seek a meeting with Exxaro to find out how they plan to make up the shortfall in black representation. Eskom spokesperson, Khulu Phasiwe said “We are going to have a meeting with them sometime soon so that we can iron out whatever differences there may be.”