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Eskom will spend R6bn above its budget to buy coal this year - Fani Zulu, spokesman
In an interview on ClassicFM @ 18:15 on 20 May 2008
[miningmx.com] -- SOUTH African power utility Eskom will spend R6bn over budget to purchase coal in the current financial year, spokesman Fani Zulu said.
In the year to end-March 2007, Eskom exceeded its coal purchasing budget by R2bn and R5bn in the 2008 financial year, Zulu said on Classic Business, a week-nightly radio programme.
"For the current financial year we’re projecting to spend R6bn over and above what the regulator has allowed us," he said.
"Now clearly this is not the behaviour of an organisation that is preoccupied with bottom line and making the bottom line look good. It is about making sure that we spend the money, we secure the coal, and therefore use the coal for generation of electricity."
Eskom has motivated for a 53% price increase for its electricity, saying it needs to recover R13bn extra it has and is spending on coal
purchases.
Ratings agency Moody's has said it it placing Eskom's currency ratings on a review.
"We have noted it. We have been interacting with a number of the rating agencies and I think the only concern that we have is that Moody’s sprung this one on us. The timing was a bit worrying largely because there has been interaction between ourselves and Moody’s and activities under way that are directed towards addressing some of the concerns that Moody’s has been raising all the time," Zulu said.
"The one particular issue being ensuring that government, as a shareholder, provides some equity injection into Eskom. And there is progress along those lines," he said.
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