POLITICS

Jacob Maroga denies being asked to resign

After Business Day reports that board has asked Eskom CEO to step down

JOHANNESBURG, Oct 30 (Reuters) - South Africa's state-owned utility Eskom's Chief Executive Officer Jacob Maroga has denied that he was asked to resign by the utility's board, Talk Radio 702 said on Friday.

South Africa's Business Day reported on Friday (see here) that Maroga had been asked at a board meeting on Thursday to quit his post, after a troubled tenure marked by power shortages, and a record 9.7 billion rand ($1.25 billion) loss in the year to end-March.

But Talk Radio 702 said Maroga had declined to be interviewed, but had told the station that no such request had been made of him by the utility's board of directors.

Maroga was unavailable to comment.

Andrew Etzinger, a spokesman for the power firm, said he could not confirm the newspaper report, but said an ordinary Eskom board meeting had been held on Thursday.

"I don't know if it's true or not, I have no information on the story at this stage," he told Reuters.

Business Day said Maroga came under pressure last month when a group of senior employees sent an anonymous letter to Public Enterprises Minister Barbara Hogan, demanding his removal. Eskom falls under the public enterprises portfolio.

The newspaper said Hogan referred the matter to the Eskom board for investigation.

South Africa's Engineering News Online said separately that a high-level meeting between board members, including Eskom's Chairman Bobby Godsell, and officials from the Department of Public Enterprises (DPE) took place late into the night on Thursday, with Hogan possibly attending.

The chairman's office said the Eskom board was preparing a statement on the matter to be released later on Friday.

A spokeswoman for the DPE Ayanda Shezi said the minister would comment in due course.

"The matter has been brought to the minister's attention, and the minister will, if necessary, comment in due course," she told Reuters.

Maroga has been heading Eskom through one of its most difficult periods, characterised by a low reserve margin, rising capital, operating costs and poor handling of coal procurement.

The utility has been rationing electricity since early 2008 when the national grid nearly collapsed, forcing mines and smelters to shut and costing South Africa billions of dollars.

Eskom has also been widely criticised for fuelling inflation after it was granted a tariff increase of 31.3 percent this year and 27 percent last year, but the state-owned utility insists it needs to increase prices to pay for its expansion.

The utility has asked the energy regulator to raise electricity tariffs by 45 percent annually for three years starting next year, to help Eskom fund the expansion of its generation capacity to meet fast-rising demand.

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