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Wednesday, May 5, 2010.

From Creamer Media in Johannesburg, I'm Mary-Anne O'Donnell.

Making headlines this week:

South African iron-ore miner Kumba Iron Ore, or KIO, has effectively moved its ongoing dispute with ArcelorMittal South Africa, or AMSA, from the realm of a pure dispute over pricing, into one that could now also affect supply. The company has indicated to Engineering News Online that it could, as a last resort, terminate supply to Africa's largest steel producer.

The JSE-listed miner said that, unless there was urgent resolution on an interim pricing and payment mechanism, the basis upon which it would continue to supply iron-ore to the steel producer could be affected.

KIO didn't immediately indicate a timeframe for reaching such an agreement. However, a spokesperson said that the time period shouldn't exceed eight weeks.

The two companies have been in dispute over the future pricing of iron-ore flowing from the Sishen mine since February 5, when Sishen Iron Ore Company notified AMSA that it was cancelling a favourable supply deal, struck in 2001, on the basis that AMSA had failed to convert its 21,4% undivided share of the Northern Cape mine in line with the demands of the Mineral and Petroleum Resources Development Act.

South Africa's water boards are proposing increases of between 6,2% and 43% to the cost of the potable bulk water they supply to the country's municipalities.
Such tariff increases, if accepted, are likely to increase the cost of drinking water supplied by municipalities to end users.

The details of the proposals are contained in a document tabled at a meeting of Parliament's water affairs portfolio committee this week, and appear to fly in the face of an announcement made by Water Affairs Minister Buyelwa Sonjica last month.

She told a media briefing at Parliament in April that she wanted to allay the fears of South Africans that there is not in the near future a possibility of a [tariff] hike. She said that it wasn't in the pipeline.

However, the department's media liaison director, Linda Page said that the minister was responding to a question on whether there were likely to be tariff increases linked to funding for infrastructure and thus potential increases in the price of raw water.

Page said that the increases that the water boards are proposing... are the normal annual increases linked to the CPIX because they operate on a cost recovery basis.

The process to recruit a new CEO for Eskom is making progress, the electricity parastatal said on Monday.

This followed the judgment last Friday in the High Court in Johannesburg that former CEO Jacob Maroga wouldn't be reinstated to his position.

The parastatal was now able to appoint a new CEO as the court had also ruled that Maroga couldn't prevent Eskom's board from naming a successor.

Eskom acting chairperson Mpho Makwana said Eskom would share further information on the appointment as soon as the process was completed.

Maroga was fired by the Eskom board in November 2009 after he denied that he had offered to resign from the parastatal.

Also making headlines:

South Africa will need to rely on a generation mix to secure future power supply.
South Africa's unemployment rate is back above 25%.
Vehicle manufacturer Ford expects the looming Transnet strike to impact on its operations.
President Jacob Zuma announces business heavyweights, such as former Eskom chairperson Bobby Godsell, MTN chairperson Cyril Ramaphosa and Business Unity South Africa CEO Jerry Vilakazi as some of the National Planning Commission members that will be responsible for drafting a long-term national development plan for the country.

That's a round up of news making headlines this week.

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