Bribery, thievery, and answers to the load-shedding plaguing the country surround the coal syndicate scandal that has spread through South Africa, the effects of which are catastrophic to the nation.
A syndicate has risen in South Africa. High-quality coal left the mine, but subpar coal arrived at the destination; how you may wonder? Once the truck exits the mine property and hits the road, the driver takes a detour to a black market coal depot. Onsite, the high-quality coal is dropped and exchanged for low-quality coal. After the exchange, the truck continues on route to finishing the delivery. The expression ‘coal switching’ is coined to describe this process. Transport drivers, however, are not the masterminds behind the conspiracy. They are simply pawns in a much larger scheme. The agent sells the coal for R1500 a ton to these black-market coal yards. The coal yards then resell at the market price of around R6000 a ton. An estimated R100 000 profit is made on a single truck, as these thieves have a no-expense business model and no diesel or transport costs needing to be covered. A pure profit, ready to be made.
One source stated in an interview with Bongani Bingwa from Cart Blanche, that ‘The head of the syndicates sends out footmen to recruit the drivers of the transport companies and offer them as much as R13000 per trip if they cooperate. In the current economic climate of SA, the transport industry has taken a few knocks after COVID-19. Transportation companies pay drivers minimum wage or less, making the average driver's salary about R8000-R10000 per month. It is easy to see why these drivers would jump at the chance for extra cash, even if it is illegally obtained.
Coal quality advisor, Xavier Prevost, spoke about the effect of using lower-grade coal and the effect the syndicate has on the economy, especially on Eskom Power stations. The Subpar coal that replaces the high-quality coal tarnishes the reputation of the South African coal export. This has made SA seem like an unreliable supplier. Subpar coal has dangerous effects on power plant boilers. This is because the use of subpar coal in boilers created for high-quality coal damages the machine and can even destroy it over time. To make matters worse, charcoal color rocks are mixed into the lower-grade coal to supplement the loss in weight. Eskom has spent billions on maintenance in the past two years and has had to spend thousands on upping its security and quality control processing. Mr. Prevost compares using subpar coal for boilers to putting petrol in a diesel vehicle.
Apart from the economic effects, owners of transport companies who were targeted, now have million-dollar liability lawsuits against them and may not survive the sting of the syndicate.
SAPD has made multiple arrests and has opened an investigation into the syndicate. What the results of their investigation will yield can only be speculated. Thus far, low-level criminals have been caught, and no substantial arrests have been made that could identify the kingpins behind the operations. In November last year, Danny Day, an independent Private Investigator identified a key player, Clarence Holdtman, owner of HTH coal in Middleburg Mpumalanga. Danny identified the location based on GPS tracking on various transporter vehicles as the locations where the ‘coal switch' takes place.
A recent sting operation in December of 2022, run by the Directorate of Priority Crime Investigation, better known as the Hawks, made three arrests in Mpumalanga. DPCI believes the arrested parties are connected to the syndicate. The arrests were made after an investigation into one of Eskom’s supplier sites. The investigation into the syndicate has brought hope to South Africans that the load-shedding and the power shortage in the country will soon come to an end.
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