South Africa's Eskom seeks regulatory approval for discounted ferrochrome tariff

JOHANNESBURG, April ⁠10 (Reuters) - South African utility Eskom on Friday ​sought regulatory approval for a discounted electricity tariff of 0.62 rand ($0.0377) per kilowatt hour for struggling ferrochrome ​producers ‌Samancor Chrome and a joint venture between Glencore and Merafe Resources.

* Eskom has submitted an ⁠application to regulator Nersa after saying in February ⁠that it would offer the ​two distressed companies a further 29% reduction in electricity prices in an effort to avert thousands of job losses.

* South Africa, the world's biggest chrome ore producer, has lost its ​position ‌as the world's top processor of chrome into ferrochrome to China mainly due to high electricity costs.

* South African smelters have been hit by a roughly tenfold increase in electricity costs since 2008, forcing dozens of plants to shut.

* State-owned Eskom ​said on Friday that the discounted tariff would not require higher consumer tariffs, ‌additional borrowing or further government financial support.

* The Glencore-Merafe joint venture had previously said it was unhappy with certain conditions attached to the ‌lower 0.62 rand a kilowatt hour power price.

* But in a statement on Friday it said some of the terms attached to the reduced tariff had been ​revised, and that it now provisionally accepted them "subject to certain clarification points".

* "This development represents a significant and ‌positive step forward in the venture's ongoing efforts to support ferrochrome beneficiation in South Africa," it added, saying it had extended a consultation process on potential job cuts for another ⁠month until ⁠May 11.

* Samancor declined to comment on its ‌job cut procedures, which it said were "subject to multiple factors that are still being assessed".

* It has previously ​said conditions attached ​to the discounted tariff were not viable. Samancor resumed procedures to ‌lay off workers in March.

* Energy-intensive smelters combine chromium and iron to produce ferrochrome, which is mainly used in steel production. ($1 = 16.4503 rand) (Reporting by Nilutpal Timsina and Nelson Banya; Editing by Alexander Winning and Jan Harvey)

Glencore