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Andre de Ruyter, CEO of Eskom, in January 2020.
Gallo Images / Business Day / Freddy Mavunda
- Eskom has made available the full report on an investigation by attorney Wim Trengrove into allegations that CEO Andre De Ruyter misled the board.
- De Ruyter has been acquitted of the charges, which were made by director Sifiso Dabengwa.
- The matter relates to a tender for the supply of fuel oil.
Eskom CEO Andre De Ruyter was acquitted of allegations that he misled the board in a fuel supply tender.
The power company released the full report on attorney Wim Trengrove’s investigation on Monday.
In a statement accompanying the report, Eskom said the Trengrove investigation, which dates back to July 14, 2020, “unconditionally acquitted” De Ruyter of allegations of misleading the board. “At its meeting on July 20, 2020, the Eskom Board adopted attorney Trengrove’s report and expressed its full support for Mr. De Ruyter,” the statement read.
The matter has been the subject of Independent Media reports, Eskom published the Trengrove report in order to “end speculation.”
According to the report, as early as May 2019, Eskom issued a tender for the supply of heavy fuel oil to its power plants for five years. In October of that year, Eskom approved awards to three suppliers: Sasol, Econ Oil & Energy and FFS Refiners. The budget for the supply of oil was 14 billion rand.
In December 2019, Eskom’s procurement officer requested its executive committee to increase the contract budget to R18 billion. This request was submitted to the Investment and Finance Committee on January 10, 2020, which subsequently rejected it, the report read.
The meetings were attended by De Ruyter, who had assumed the position of CEO of the Group days earlier. It was concerned about the quality of the information provided in the request for a budget increase for heavy fuel contracts and decided to investigate the matter, “the report said.
On the basis of the outcome of the investigation, De Ruyter concluded that the contracts had not been awarded correctly.
At the first board meeting De Ruyter attended on January 16, 2020, one of the main areas of focus that he proposed was the cancellation of fuel oil contracts, due to allegations of fraud and corruption with some suppliers of fuel oil and Eskom employees. Reference was also made to the decision of the Eskom board on January 30, 2019 to pursue “a new strategy” for the purchase of fuel oil by the power company for all its coal-fired power plants directly from refineries, as a measure. cost savings. This was supported by the Treasury, the report noted.
A memorandum was prepared for the board to inform him of the “serious matters” related to the fuel oil contracts and to recommend that he consider canceling the contracts. The board of directors finally resolved to cancel the contracts, through a round robin resolution, based on various reasons such as the detection of possible collusive practices by the bidders, the breach of an article of the Competition Law and the breach of the principles of justice. , transparency, fairness and competitiveness, among others. others.
However, two of Eskom’s directors, Sifiso Dabengwa and Dr. Pulane Molokwane, “strongly opposed” the proposal. “The subject of their objections was that the reasons for the proposed cancellation were speculative and unsubstantiated, thus they did not justify the proposed cancellation,” the report read.
Later, in a series of emails that followed the board meeting where the proposal was approved, Dabengwa accused the “administration”, and de Ruyter in particular, of misleading the board.
Eskom instructed Trengrove to investigate Dabengwa’s allegations and determine if they were justified.
In its conclusions, Trengrove said that the evidence established a “high degree of probability” that Eskom’s board adopted a new strategy on January 30, 2019 to acquire heavy fuel oil only from refineries.
“The evidence establishes, beyond any doubt, that Mr. De Ruyter, in any case, honestly believed that the board had adopted such a strategy. He said that he based his statement on the letter from the National Treasury dated February 15, 2019.” , the report reads.
“It follows that Mr. De Ruyter’s statement was probably correct, but in any case totally honest and justified.”
Trengrove noted that Dabengwa’s allegation of dishonesty was “unfounded and irresponsible.” “Mr. Dabengwa did not have the slightest support for his charge of dishonesty. It was irresponsible on his part to do so,” the report read.
