Eskom initiates steps to cancel irregular R14 billion contract

Power utility Eskom has initiated steps to cancel a five-year contract which is reported to be worth R14 billion.

The power utility said on Friday that it has commenced a process “to cancel” the “irregular fuel oil supply contract”, which was awarded to Econ Oil & Energy in 2019.

“A review of the circumstances leading to the tender being awarded to the company revealed serious irregularities in the process, including inflated prices charged to Eskom when lower-priced alternatives were evident,” Eskom said in a statement.

Eskom has written to the supplier notifying them of its intention to have the contract terminated through a legal process, the statement reads.

“Eskom is currently reviewing the roles played by all stakeholders in awarding the tender, including the role of its own employees. Where applicable, disciplinary processes will be pursued and criminal charges laid.”

The entity said earlier this year it commenced with a process to review all major contracts, adding that “where evidence of corruption or other irregularity has been discovered, Eskom will not hesitate to take steps to cancel such contracts and to recoup any losses that it might have incurred as a result of any irregular actions”.

(Compiled by Makhosandile Zulu)

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