JOHANNESBURG, July 23 (Reuters) – A 10-year energy provide settlement between South African utility Eskom and South32’s S32.AX Hillside aluminium smelter has been accepted, offering value certainty for the vitality intensive operation, the Australian-listed firm stated on Friday.
The approval from South Africa’s vitality regulator secures vitality provide till 2031 for the Hillside smelter, state-owned Eskom’s largest industrial buyer, beneath a rand-based tariff with escalations linked to South Africa’s producer value index (PPI), South32 stated in a press release.
This can substitute the earlier contracts, which had been U.S greenback primarily based and linked to the aluminium value on the London
Steel Trade.
“Hillside has been a significant Eskom buyer for 25 years and this settlement offers energy value certainty for an additional 10 years, with Eskom receiving a value aligned to long-term tariff coverage,” stated South32 Chief Govt Graham Kerr.
South32 stated the working unit value for the 2021 monetary 12 months will replicate the upper energy fees from the brand new settlement.
The settlement can even enable Eskom to interrupt provide to the smelter throughout nationwide energy cuts.
(Reporting by Tanisha Heiberg Enhancing by David Goodman)
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