Investec Bank closed the accounts of Econ Oil. File Photo: IOL
Johannesburg - The businesswoman fighting Eskom over the blacklisting of her company has blamed the power utility for losing out on funding worth millions of rand and the closure of her accounts by some commercial banks.
Econ Oil & Energy managing director Nothemba Mlonzi accuses Eskom and its former chief executive officer André de Ruyter of conducting a negative media campaign against her company.
“Suppliers and banks have read the allegations against Econ Oil in the media. These suppliers have sought to terminate their relationship with Econ Oil based on Eskom’s unfounded allegations,” she told the Competition Tribunal.
Mlonzi wants the tribunal to declare that Eskom’s decision to blacklist Econ Oil impedes or prevents her from participating or expanding within the South African fuel oil market.
The Competition Commission has informed her that its investigation into the complaint filed by Econ Oil against Eskom after the power utility blacklisted the company will be finalised in September this year. She complained in September 2021.
According to Mlonzi, Investec terminated its relationship with Econ Oil “in light of the recent build-up in news regarding Econ Oil and Eskom allegations” and closed her account in August 2020.
Nedbank told her that it had come to its attention that her company was under investigation regarding previous Eskom tenders.
“Until such time as we have more clarity on the outcome of these investigations, we regret that we will not be in a position to consider any further funding opportunities,” wrote Nedbank Corporate and Investment Banking associate Dianne Jolly in June 2021.
A year earlier, she lost out on funding from the Development Bank of Southern Africa, Total and Shell, which gave her two months’ notice of termination of their agreement in April 2021.
“There is a clear causal link between Eskom’s anti-competitive conduct and the decisions of other suppliers to terminate their relationship with Econ Oil ... The link is clear,” complained Mlonzi.
In July last year, FNB informed Econ Oil that it had elected to terminate its banking relationship with the company and that it would do so in two months.
“It is common cause that FNB’s relationship with its customers is one governed by the Private Law of Contract in terms of which FNB derives the right to terminate. After careful consideration, FNB has now elected to exercise its contractual right to terminate its banking relationship with you due to the associated reputational and business risks,” the financial institution wrote to Mlonzi.
In her interim Competition Tribunal application, Mlonzi accuses Eskom of engaging in conduct that contravenes the Competition Act and is a prohibited practice that is manifestly anti-competitive and anti-transformation.
She also disputed that Econ Oil’s profits or net profits come anywhere close to R15 billion.
"In any event, these amounts were earned over a period of 17 years. They are not handouts. They are payments made for products delivered in terms of the contract. There was nothing corrupt about them as the deponent (Eskom) now seeks to imply,” explained Mlonzi.
She added that Econ Oil procured fuel oil from refiners and that it incurredfixed and variable costs in its business. Eskom said Econ Oil’s account of the dispute was not based on facts and maintained its position that the company was appropriately deregistered from the power utility’s supplier database.
The Sunday Independent reported last week that Mlonzi's complaint to the commission was centred around Eskom's former CEO. In her complaint, she accused De Ruyter of purging black-owned companies and protecting white-owned businesses.
Mlonzi accused De Ruyter of being anti-transformation and anti-competitive after Eskom allegedly blacklisted Econ Oil and Energy based on unfounded suspicions and charges.
Mlonzi has alleged that the power utility blacklisted her company while those who have been involved in corruption continue to do business with the state-owned utility. She said De Ruyter was the one who pursued the decision after he was appointed in January 2020.
This was after De Ruyter ordered the cancellation of a contract between Eskom and Econ Oil based on allegations of corruption. De Ruyter’s instruction came after a report by Bowmans Law Firm made severe findings against Econ Oil, claiming that the company had defrauded and overcharged Eskom by different amounts for the five-year contract it was awarded.
In March 2021, Eskom’s supplier review committee (SRC) gave notice to temporarily suspend Econ Oil from its database based on allegations that a corrupt relationship existed between Mlonzi and Eskom senior manager Noluthando Patricia Marah. The power utility claimed Marah interfered with Eskom’s procurement processes to benefit Econ Oil.
In a replying affidavit submitted to the Competition Tribunal, Mlonzi said the decision was taken without allowing Econ Oil to respond to the allegations. She added that the utility acted in a selective and discriminatory manner, saying other firms implicated in fraud and corruption continued to provide goods and services to Eskom.
In its response, Eskom acting spokesperson Daphne Mokwena said the account offered by Mlonzi in the founding papers was not based on fact and Eskom maintained the position that Econ Oil was appropriately de-registered from its supplier database in the circumstances described in the answering affidavit.