Coal Export Plan Could Hit Eskom Supplies
SA produces high-quality thermal coal for export and lower-quality coal for domestic use. The country has a reputation for its consistency of quality and low sulphur content, which averages 0.8%.
The idea of creating a new, lower export grade has been mooted to cater for the Indian market. This has not gone down well with Eskom and government, as export markets would then compete with the electricity parastatal for coal.
Stephen Meintjes, head of research at Imara SP Reid, said Eskom should be concerned about future supply because of the mistakes made in sourcing from unreliable suppliers leading to the crisis in early 2008.