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Final report: Forensic investigation into various allegations at EskomTermDescriptionPFMAPublic Finance Management Act, 1999 (Act 1 of 1999)PEDPrimary Energy DivisionPPPFAPreferential Procurement Policy Framework ActRFPRequest for ProposalSAPSSouth African Police ServiceSBTCEskom Special Board Tender CommitteeSCSSupply Chain ServicesMpumamanziMpumamanzi: Coal TransportationSibonisiweSibonisiwe (Pty) LtdSGSSGS (Pty) LtdSOCState Owned CompanyVATValue Added TaxEXHIBIT LISTSAnnexureDescriptionNo.E1Copy of a unsolicited bid to supply coal to Eskom submitted by Goldridge in May2014E2Copy of paragraph 3.4.5.8 and 2.5.6 of the Procurement and Supply ChainManagement PolicyE3Copy of the minutes of the meeting between Eskom and Goldridge held 9 May2014E4Copy of the minutes of the meeting between Tegeta and Eskom held on 10 June2014E5Copy of Tegeta response to Eskom dated 14 September 2016 “Tegetaacknowledging that mining was taking place very close to a stream”Page ix

Final report: Forensic investigation into various allegations at EskomAnnexureDescriptionNo.E6Copy of an email from Nyangwa to Mothapo dated 25 June 2014 “titledBrakfontein Technical Assessment”E7Copy of a report dated June 2014, addressed by Nyangwa to PED, Titled “Tegeta,Brakfontein blend technical assessment”E8Copy of an updated report dated 2 July 20114 addressed Mothapo to Ntshangaand copied to Thozama Gangi, Titled “ Brakfontein (Tegeta) Technical EvaluationUpdate”E9Copy of a Technical Assessment report for evaluation purpose dated August 2014addressed by Nyangwa to the PED titled, Tegeta, Brakfontein S4L technicalAssessment”E10Copy of the minutes of the meeting between Eskom and Tegeta dated 23September 2014E11Copy of a submission of Tegeta’s commercial offer via an email dated 23September 2014 addressed by Mudaliar to NtetaE12Copy of a letter dated 23 September 2014 addressed by Tegeta to Eskom titled “Commercial offer for supply of coal to Eskom”E13Copy of an email dated 6 October 2014 addressed to Nteta by Nath and copied toMashego, Mudaliar, Mothapo and Mishra titled “RE: Commercial Offer – 4 upperSeam – Tegeta Exploration.E14Copy of an email dated 9 October 2014 addressed to Nath by Nteta and copied toMashego, Mothapo and Mishra titled “Template Cost Breakdown Sample”E15Copy of an email dated 6 November 2014 addressed by Nath and Nteta and copiedto Mudaliar, Mashego, Mothapo and Adity, titled “ RE: Template cost breakdownand Sample”E16Copy an email dated 7 November 2014 responding to the email dated 6 November2014E17Copy of a CSA template attached to the email dated 7 November 2014Page x

Final report: Forensic investigation into various allegations at EskomAnnexureDescriptionNo.E18Copy of an email dated 27 November 2014 addressed by Mothapo to Nyangwaand copied Gangi, Nteta and Dr Van Alphen, titled “Brakfontein S4U and BlendAnalysis feedback”E19Copy of an email dated 13 January 2015 from by Mothapo to Nteta and copied toGangi, Nyangwa and Dr Van Alphen titled “RE: Brakfontein S4U and Blendanalysis feedback”E20Copy of an email dated 14 January 2015 from Dr Van Alphen to MothapoE21Copy of an email dated 15 January 2015 addressed by Nteta to Mothapo and whereGangi was copied, titled “RE: Brakfontein S4U and Blend analysis feedback”E22Copy of an email dated 16 January 2015 from Mothapo to NtetaE23Copy of the minutes of the t between Eskom and Tegeta held on 23 January 2015E24Copy of minutes of a meeting held between Eskom and Tegeta on 30 January 2015E25Copy RT & D’s Technical Memorandum titled “Technical Evaluation ofBrakfontein Contract” dated 28 June 2018, authored by Dr Van Alphen andreviewed by NyangwaE26Copy of Tegeta water use licence Number: 04/B20E/ABCGIJ/2994E27Copy of a compliance Audit report dated 20 September 2016E28Copy of Tegeta response to Fundudzi second draft reportE29Copy of Eskom’s email response to Fundudzi’s request on clarity relating to theauditsE30copy of a letter dated 30 January 2015 addressed to Nath by Bester titled “CoalSupply Offer – Tegeta (Brakfontein Colliery)”E31Copy of an email dated 3 February 2015 addressed by Nteta to Mhlophe andcopied to Nath, Mashego, Portia Ndlovu (“Ndlovu”), Mudaliar titled “VendorRegistration”Page xi

Final report: Forensic investigation into various allegations at EskomAnnexureDescriptionNo.E32Copy of an email sent on 3 February 2015, from Nteta to Luyanda Mlonzi(Mlonzi”) an Eskom official requesting her to do a vendor registration for TegetaE33Copy of an email dated 5 February 2015 addressed by Mlonzi to Nteta titled “Re:Vendor Registration”E34Copy of an email by Nteta responding to the above enquiry, through an emaildated 5 February 2015 titled “Re: Vendor Registration”,E35Copy of an email dated 9 February 2015 addressed by Nath to Mlonzi and copiedto Nteta and Mudaliar, titled “RE: Vendor Registration – Tegeta Exploration”.E36Copy of an email dated 10 March 2015 addressed by Modiehi Mapela (“Mapela”)to Nath and copied to Nteta, titled “Tegeta Exploration And Resources”E37Copy of a letter, attached to Nath’s email, dated 3 February 2015 addressed toBester titled “Coal Supply Offer – Tegeta (Brakfontein Colliery”E38Copy of a letter dated 12 February 2015 addressed to Nath by Bester titled “CoalSupply Offer – Tegeta (Brakfontein Colliery And Extension)”E39Copy of Tegeta response to Eskom’s letter of 12 February 2015 through an emaildated 13 February 2015 addressed to Nteta by Nath titled “Re: 722983 Coal SupplyOffer - Tegeta (Brakfontein Colliery And Extension)E40Copy of an email dated 13 February 2015 addressed by Nteta to Nath, respondingto the above email, titled “Re: 722983 Coal Supply Offer - Tegeta (BrakfonteinColliery And Extension)”E41Copy of Nteta responded to Nath’s email of 13 February 2015, through an emaildated 16 February 2015 titled “Re: 722983 Coal Supply Offer - Tegeta (BrakfonteinColliery And Extension)E42Copy of a briefing note dated 10 March 2015adressed by Bester to Mboweni “CSAwith Tegeta Exploration and Resources”.E43Coy of an email sent by Nath and Mudaliar and copied Mashego sent 9 march 2015at 19:08pmPage xii

Final report: Forensic investigation into various allegations at EskomAnnexureDescriptionNo.E44Copy of a Technical Memorandum dated 12 March 2015 addressed by Dr. vanAlphen to the PED referenced “RT&D FM 209-21 Rev.1” and titled “BrakfonteinS4L Coal Assessment”E45Copy of an email dated 23 March 2015 addressed by Nteta to Mothapo and copiedto Mashego, titled “Feedback on Full Combustion Test – Brakfontein Colliery”.E46Copy of CSA between Tegeta and Eskom concluded on 10 March 2015E47Copy of an email from Nyangwa to the PED “Tegeta, Brakfontein March 2015Blend Technical Assessment”, attached to it a Technical Assessment Report datedApril 2015.E48Copy of RT &D’s Technical Memorandum in respect of Tegeta Coal dated 17 April2015 addressed by Dr Van Alphen to PEDE49Copy of a Technical Memorandum dated 18 June 2015 addressed by Dr VanAlphen to the PED referenced “RT&D FM 209-21 Rev.1” and titled “BrakfonteinBorehole Assessment”E50Copy of Coal Offloading Reconciliation document prepared by Majuba that thefirst delivery from Brakfontein Colliery was made on 7 April 2015.E51Copies of minutes of the monthly Technical Liaison Meetings held between 13May 2015 and 21 September 2016.E52Copy of Majuba Power Station’s coal analysis report in respect of coal analysisresults performed on 30 May 2015, titled “Coal Analysis From Unit One MillFeeders”E53Unsigned copy of Sibonisiwe’s coal analysis report dated 28 August 2015 titled“Test Report – Coal Analysis” with reference “1509-153”E54Copy of an undated and unsigned SGS’s coal analysis report titled “TESTREPORT” and referenced “2015/15-8”E55Copy of M Koko’s response to Fundudzi questionsE56Copy of Van der Riet’s responsePage xiii

Final report: Forensic investigation into various allegations at EskomAnnexureDescriptionNo.E57Copy of an email dated 26 August 2015 from Ramavhona to Molatuli and copiedto Ridwaan Asmal (“Asmal”) titled “Samples to be delivered by Morne fromNatural sampling”E58Copy of an email from Riet to Koko sent on 26 August 2015E59Copy of an email from Riet to Koko and Copied Mboweni, Dan Mashigo, PetrosMazibuko, van der Riet and Ramavhona with attached letter to BrakfonteinCollieryE60Copy of Mpumamanzi observers reportE61Copy of Mpumamanzi’s responseE62Three copies of delivery notes dated 29 August 2015 prepared by Mahlangu onbehalf of MpumamanziE63Copy of a signed SABS’s coal analysis report dated 30 August 2015 , titled “CoalAnalysis”E64Copy of an email dated 30 August 2015 addressed to Koko by Van Der RietE65Copy of a letter of suspension dated 31 August 2015 issued by Koko to TegetaE66Copy of a letter dated 5 September 2015 from Koko notifying Tegeta of theupliftment of the suspensionE67Copy of a letter addressed from Nath to Nteta dated 28 August 2015, titled CoalSupply Offer”E68Copy of a letter dated 31 August 2015 addressed by Ramavhona to Frans Wolters(“Wolters”) titled “Transport And Analysis Services Contract Between The SabsAnd Eskom: Transport And Analysis Of Eskom Contractual Samples From TegetaBrakfontein Colliery – Ref: 724828”E69Copy of Nteta’s e-mail sent on 14 September 2016 at 9:30, attached was a documenttitled, NT – Reply clean doc” and contains a list of responses to National Treasury’sinvestigation at Eskom at the timePage xiv

Final report: Forensic investigation into various allegations at EskomAnnexureDescriptionNo.E70Copy of letter from Nteta addressed to Business Rescue Practitioners Marsdenand Van Den Steen, dated 30 March 2016.E71Copy of CSA between OCH and Eskom with effective date of 1993 and expiringDecember 2018E72Copy of a submission e-mailed to Bester and Nteta by Jithin Mohan”E73Copy of Nteta’s response to Marsden’s meeting request on 14 August 2015E72Copy of an e-mail sent to Molefe by Bronwyn de Villiers on 16 October 2015 andits attached letterE73Copy of an E-mail communication between Nteta and Mohan dated 13 April 2016E74Copy of the minutes of Sustainable Hendrina Coal Supply meeting dated 24November 2015E75Copy of an agreement signed between Eskom and Tegeta regarding the prepurchase of coal from Optimum Coal Pty LtdE76Copy of Daniels’ email sent to Zethembe Khoza on 8 April 2016 at 16:37E77Copy of an email sent on 11 April 2016 at 16:27 by Ravindra Nath (“Nath”) sent toNteta with the subject matter reflected as draftE78Copy of an email from Nteta on 11 April 2016 at 07:22 to Koko, Mabelane andMboweniE79Copy of Extract of the minutes of the Special Board tender Committee meetingheld by teleconference on 11 April 2016 at 21:00E80Copy of an email by Nteta to agesan rajagopaul@mckinsey.com sent at 18:04E81Copy of a pro forma Invoice issued by Tegeta to Eskom relating to prepayment ofR659 558 079.00Page xv

Final report: Forensic investigation into various allegations at EskomAnnexureDescriptionNo.E82Copy of an email by Ronica Ragavan, one of Tegeta Directors sent an e-mail toAnoj Singh and Nath with the subject reflected as “Tegeta shareholdersresolution”E83Copy of an email sent to Singh’s email from an e-mail address reflected as BrianMolefe mdprivate-mail0@gmail.com on 3 November 2015 at 13:54E84Copy of email sent by Koko to the e-mail address infoportal1@zoho.com. on 20July 2015 at 09:47E85Copy of Ngubane’s responsePage xvi

Final report: Forensic investigation into various allegations at Eskom1.INTRODUCTION1.1.National Treasury issued a request for quotation with reference number RFQ 026-2017, forthe appointment of a forensic audit firm to investigate issues raised on Eskom-TegetaExploration and Resources (Pty) Ltd (“Tegeta”) report as well as the National Treasury’spreliminary investigations at Transnet.1.2.National Treasury conducted a preliminary investigation into various allegations at bothEskom and Transnet. Based on National Treasury’s preliminary findings, they sought toappoint a forensic audit investigation firm to conduct a thorough and detailed investigationinto the issues raised at the two state owned companies.1.3.Fundudzi Forensic Services was appointed to conduct investigations into allegations atTransnet and Eskom regarding the Locomotives tender and Tegeta, respectively.1.4.We have issued four reports (four chapters) of our investigations as follows:1.4.1. Chapter 1: Acquisition of 95, 100 and 1064 locomotives for Transnet Freight Rail;1.4.2. Chapter 2: Appointment of McKinsey, Regiments and Trillian at Eskom andTransnet1.4.3. Chapter 3: Investigations relating to Tegeta1.5.This report (Chapter three of our investigation) is privileged and confidential and wasprepared solely for purpose of reporting our findings to National Treasury and shouldtherefore not be utilised for any other purpose without our prior written consent.BACKGROUND TO THE INVESTIGATION1.6.It is our understanding based on National Treasury report that during 2013, there werenegotiations with Eskom regarding the supply of coal to Eskom. We further understand thatafter the negotiations, Tegeta subsequently submitted a proposal to Eskom during September2014. We further understand that after the proposal was submitted Eskom entered into aCoal Supply Agreement (“CSA”) with Tegeta.1.7.The issues raised on the Eskom-Tegeta contract relate to Eskom’s processes followed in theappointment of Tegeta for the supply of coal for a period of ten years.1.8.National Treasury further indicated that there could be issues of fruitless and wastefulexpenditure relating to the CSA which may include inter alia the advance payment of fundsto Tegeta.Linked to the advance payment, issues were raised whether there werepossibilities of corruption on the Eskom officials involved in the said payment. In this regard,Page 1

Final report: Forensic investigation into various allegations at Eskomit was indicated that two of Eskom’s Officials, Anoj Singh, Chief Financial Officer (“Singh”)and Matshela Koko, Executive Director of Generation (“Koko”) undertook trips to Dubai,which trips were allegedly paid for by the Gupta Family.1.9.National Treasury further indicated that the investigation should establish the role playedby the former Chief Executive Officer of Eskom, Mr Brain Molefe (“Molefe”) regarding CSAentered into between Eskom and Tegeta.DETAILED ALLEGATIONS RELATING TO ESKOM1.10. We understand that the scope of our investigation will be to independently investigate thefollowing:1.10.1.Investigate why Eskom gave and continued to give preferential treatment to TegetaExploration and Resources (Pty) Ltd (“Tegeta”) by not enforcing key conditions ofthe CSA and whether it amounted to the abuse of position of authority, a breach oftrust; or a violation of a legal duty or a set of rules in terms of the Prevention anCombating of Corrupt Activities Act;1.10.2.Investigate whether Eskom acted negligently by not enforcing key conditions of theCSA particularly the Conditions Precedence of the Agreement and whether itamounted to the abuse of a position of authority, a breach of trust; or the violationof legal duty or a set of rules in terms of PRECCA;1.10.3.Investigate why Eskom failed to take effective and appropriate steps to preventfruitless and wasteful expenditure;1.10.4.Investigate why Eskom concluded a 10 year contract expiring in 2025 disregardingthe terms and conditions of the offer agreed on 30 January 2015 and without theapproval of the Board Tender Committee and whether it amounted to the abuse ofa position of authority, a breach of trust; or the violation of a legal duty or a set ofrules in terms of PRECCA;1.10.5.Investigate why Eskom through its former CEO gave an assurance that BrakfonteinColliery supplied and continues to supply coal that conforms to the CSA despiteample evidence that there was non-compliance and whether it amounted to theabuse of a position of authority, a breach of trust; or the violation of a legal duty ora set of rules in terms of the Prevention and Combating of Corrupt Activities Act(“PRECCA”);1.10.6.Investigate whether the Chief Financial Officer, Anoj Singh (“Singh”) and MatshelaKoko (“Koko”) acted negligently when implementing the directives of the BoardPage 2

Final report: Forensic investigation into various allegations at EskomTender Committee and whether it amounted to the abuse of a position of authority,a breach of trust; or the violation of a legal duty or a set of rules in terms of thePRECCA, analyse and identify the employee funding sources;1.10.7.Investigate whether the directives of the Eskom Board Tender Committee (“BTC”)relating to advance payment were unlawful and whether it amounted to the abuseof a position of authority, a breach of trust or violation of legal duty or set of rulesin terms of PRECCA;1.10.8.Investigate whether the Singh and Koko accepted Dubai trips paid by the Guptasas alleged by the #GupaLeaks and whether it amounted to the abuse of a positionof authority, a breach of trust or violation of legal duty or set of rules in terms ofPRECCA;1.10.9.Investigate whether Koko leaked any confidential information as alleged by the#GupaLeaks and whether it amounts to abuse of a position of authority, a breach oftrust or violation of legal duty or set of rules in terms of PRECCA;1.10.10. Investigate whether Singh facilitated the appointment of suppliers for thelocomotive tender in Transnet and whether such facilitation amount to abuse of aposition of authority, a breach of trust or violation of legal duty or set of rules interms of PRECCA;1.10.11. Investigate whether Ayanda Nteta (“Nteta”) or any other Eskom changed the termsand conditions of the CSA as alleged by the #GupaLeaks and whether their actionamounted to the abuse of a position of authority, a breach of trust, or the violationof a legal duty or a set of rules in terms of PRECCA;1.10.12. Determine fruitless and wasteful expenditure arising out of payment made toTegeta for coal from Brakfontein and Brakfontein Extension;1.10.13. Determine fruitless and wasteful expenditure arising out of payments made toTegeta for coal from OCM;1.10.14. Determine interest due and payable arising out of a loan given to Tegeta for coalfrom OCM;1.10.15. Establish whether Eskom management prejudiced Glencore by refusing to sign thenegotiated CSA giving advantage to Tegeta the abuse of position of authority, abreach of trust, or the violation of a legal duty or a set of rules in terms of PRECCA;Page 3

Final report: Forensic investigation into various allegations at Eskom1.10.16. Establish whether Eskom management prejudiced Glencore by fining OCM R2,1billion for supplying poor quality coal and whether it amounted to the abuse of aposition of authority, a breach of trust, or the violation of a legal duty or

Final report: Forensic investigation into various allegations at Eskom Page iii 1.11. The samples tested by SABS on 29 August 2015 were not from Brakfontein mine due to the significant difference in the samples tested on 29 September 2015 and 6 September 2015 1.12. The integrity of SABS tests results of 30 August 2015 are brought to question in