Eskom enters agreement with Samancor and Glencore-Merafe

Image credit: Reuters/Siphiwe Sibeko

Eskom said in a statement that the memorandum of understanding with the two companies followed constructive engagements with the Minister of Electricity and Energy, Kgosientsho Ramokgopa, and trade unions.

Samancor Chrome and the joint venture between Glencore and Merafe Resources have said they are considering job cuts due to pressure, including rising electricity costs.

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The National Energy Regulator of South Africa (Nersa) is currently reviewing an interim power tariff adjustment for the two firms, and the government is working on a longer-term mechanism to support competitive pricing for the ferrochrome sector, Eskom said.

South Africa holds approximately 80% of the world's known chrome ore reserves, according to Glencore, positioning the country as a key player in global ferrochrome production.

Once an interim tariff for Samancor Chrome and the Glencore-Merafe Chrome Venture is approved, the companies have committed to suspending layoff processes and bringing back about 40% of their furnace capacity.

At the same time, a long-term solution is being developed, Eskom added.