[miningmx.com] — BHP Billiton (Billiton) has indicated it would apply for leave to appeal against the judgment handed down by the South Gauteng High Court on Friday, whereby it and power utility Eskom were ordered to disclose the power pricing agreement for BHP’s Mozal and Hillside aluminium smelters.
BHP spokesperson Ruban Yogarajah said the group was still studying the judgment, but by Friday afternoon Eskom’s legal representatives told business daily Sake24 (the applicant) it couldn’t provide the paper with the requested information, due to Billiton’s intention to appeal the judgment.
“We have been informed by the attorneys acting for the second (Billiton) and third (Hillside) respondents that their clients intend to apply for leave to appeal against the judgment handed down this morning,’ read a letter from Eskom’s legal representatives Bowman Gilfillan.
“Accordingly, our client will provide your client with copies of the relevant records if application for leave to appeal is not made within the prescribed period, or should leave to appeal not be granted.’
Eskom, who was the first respondent, earlier said it would not appeal.
Sake24 first requested the information about two years ago in terms of the Promotion of Access to Information Act (Paia), citing public interest.
Kgomo concurred, ordering Eskom and Billiton to hand over the following information:
– The formula used to determine the price that Billiton pays for electricity for its Mozal and Hillside aluminium smelters;
– The duration of these contract;
– The names of the individuals who signed these contracts on behalf of Eskom and Billiton.
SUBSTANTIAL HARM
In his 70-page judgment, Kgomo concurred with Billiton’s argument that the diversified miner would suffer “some commercial harm’ if the requested information would be made available.
“It has shown that knowledge of its costs of production could enable its competitors to alter their commercial behaviour to take advantage of their knowledge of Billiton’s position,’ read the judgment.
“These competitors would then be able to engage in competitive behaviour with the advantage of this knowledge, which advantage Billiton would not be having as it would be in the dark about their (competitors’) state of affairs. The competitors may also use such knowledge to calculate Billiton’s costs of production and then use the information in their negotiations of it.’
Kgomo said, however, that public interest was an overriding matter.
“Based on.that the two Billiton smelters consume 5.68% of Eskom’s total base load capacity and that Eskom’s base load deficiency is almost the same percentage, the conclusions by the applicants and the general public that the extent of the rolling electricity blackouts experienced in South Africa since 2008 would have been substantially reduced, or completely eliminated, make sense.
“Such conclusions and perceptions can be dealt with and laid to rest by a disclosure of the documents relevant to the supply of electricity to the Billiton smelter,’ Kgomo said, adding that an overwhelming majority of services and conveniences rendered to the general public were dependent on the supply of electricity.
Kgomo also alluded to the fact that residents faced regular and sustained price increased on electricity while the smelters enjoyed security of supply without having the worry about increases until 2026.
“A few weeks earlier as at the date of this judgment a hefty price increase was implemented and a similarly hefty increase is already scheduled for next year.’
The agreements between Eskom and Billiton over the smelters were concluded in the 1990’s when Eskom had an oversupply of electricity. Hillside required 1,100MW and Mozal 845MW, with pricing linked to the market prices of aluminium.
The parties have already renegotiated a steady pricing structure for Mozal, with discussions over Hillside still ongoing.
