Thursday, May fifteen, 2008.
From Creamer Media in Johannesburg, I'm Shannon O'Donnell.
Making headlines today:
Struggling State-owned power utility Eskom on Wednesday remained "cautiously optimistic" that it would squeeze through the winter months without serious load shedding, but warned that its power supply remained in a precarious position.
Demand-side manager Andrew Etzinger said that Eskom was in a better position now than what it was in January, or before winter last year, after having completed maintenance, as well as adding new generation capacity and improving coal stockpiles.
He said that Eskom's average coal stockpile level now stood at 16,2 days, compared with the average ten days in January.
It is increasingly likely that the South African government, which is the sole shareholder in power utility Eskom, would set out a "smoothed" tariff-increase scenario at the energy summit that will convene in Johannesburg on Friday.
But a high-placed Eskom official said that there still appeared to be a desire to safeguard the utility's BBB+ credit rating with Standard & Poor's, which placed the corporation on a negative credit watch in January.
This implied that the funding shortfall would most probably have to be met through a combination of a debt-raising exercise, as well as from a scaled-up shareholder injection from National Treasury.
At a media briefing in Cape Town on Wednesday, Public Enterprises Minister Alec Erwin gave the strongest indication yet that a smoothed tariff scenario would indeed be pursued.
The biggest challenge for platinum-from-dumps producer Sylvania Resources, was how to spend the "mountain of cash" it had started generating, as the company reported a 34% increase in production to 4 802 ounces of platinum group metals, or PGMs, in the March quarter, and looked set to produce 70 000 ounces a year of PGMs by 2010.
Nonexecutive chairperson Richard Rossiter said that the situation was atypical to any of the junior exploration companies, in that it was producing a mountain of cash flow in the beginning part of its life, instead of asking the shareholders for more cash to drill another hole. The challenge the company has now, is how to spend that cash flow, he said.
The company boasted a margin of 84%, and its pre-tax profit at March 2008 was up 146% quarter-on-quarter to R56-million.
Sylvania CEO Terry McConnachie:
Also making headlines:
Eskom reveals its pricing hand in tender for near-term capacity
Airbus offers mixed fleet for SAA future requirements
South Africa is right to raise interest rates says the International Monetary Fund
Uranium One posts loss as sales decline
Optimum Coal plans listing as it concludes agreement to buy BHP's colliery
And, Katanga arranging 550-million dollar loan to fund DRC project
In political news:
Zimbabwe presidential runoff vote delayed says government
SADC says Zimbabwe not yet set for fair vote
Ethiopian troops distribute food aid in Mogadishu
And, John Edwards backs Barack Obama's White House bid
That's a round up of news making headlines today. For more on these and other stories, visit engineeringnews.co.za, miningweekly.com and polity.org.za