Eskom left in limbo as govt stalls the appointment of CEO

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Fin 24

Considering that Eskom poses the biggest risk to the economy, appointing a permanent chief executive officer to turn it around is widely seen as a top priority for President Cyril Ramaphosa’s administration.

Yet while the government pledged to name a new head of Eskom by the end of October, it’s missed repeated deadlines to act, evidence of how politically fraught the process has been. Jabu Mabuza, the utility’s chairman, has filled the post in an interim capacity since Phakamani Hadebe quit in July.

Ramaphosa said almost a month ago that the appointment would be made “soon,” a pledge he’s repeated several times since, while Public Enterprises Minister Pravin Gordhan told 702 the name would be announced by November 10. And Jackson Mthembu, a minister in the presidency, said on October 31 that the cabinet had made its selection -- but it remains under wraps.

“The delay in announcing the CEO is another clear indication of the power struggle around Eskom,” said Darias Jonker, a London-based director at Eurasia Group Ltd. “Competing interest groups each have their preferred candidate and Ramaphosa is yet again wavering over a key government decision.”

The new CEO will help oversee government plans to split Eskom into generation, transmission and distribution units under a state holding company -- a breakup opposed by powerful labor unions who see it as a precursor to privatisation and job losses.

Front runner

Andy Calitz is seen to be the front runner for the Eskom job. A South African who started his career at Eskom, Calitz has been working for Shell since 1996 in Australia, China, Russia and India.

He is currently CEO of LNG Canada, a joint venture between Shell, PetroChina, the South Korean’s state natural gas company Kogas and the Mitsubishi Corporation, Japan's largest trading company. The company is building a $40bn liquified natural gas project which will be the largest private sector investment ever in Canada. It is currently under construction in Kitimat, British Columbia and will include a 670-km pipeline.

Calitz – dubbed the “CEO of Hope” according to one report – has been credited for securing approval from government, and agreement among all affected parties (including 25 groups of First Nations indigenous people), to proceed with the project after many years of negotiations and setbacks.

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