Sasol, the world's largest fuel from coal producer, is seeking approval from the National Energy Regulator of South Africa (Nersa) to expand fuel storage capacity at its Alrode terminal in Alberton, to 69,800 cubic metres at a cost of R820 million, international fuel retail publication PetrolWorld reported on Wednesday.
The cost of the expansion of the Alrode terminal, which has been dubbed the Thibela project, is to be financed by Sasol from its internal cash resources.
Sasol told a Nersa public hearing into the application that the petrochemicals group planned to build store depots in Pretoria, Polokwane, Klerksdorp, Nelspruit and Durban.
The cost of these depots has not yet been established.
Sasol reduced the size of the Alrode expansion from 105,900 cubic metres to 69,800 cubic metres due to safety concerns, including the congestion of the site, mainly due to extensions to accommodate the expansion of its delivery fleet.
The Alrode facility had an average spare capacity of 2.5 days of fuel supply and the aim was to increase this to 10 days.
Citing Sasol manager in charge of the expansion Andre van der Merwe, the publication said the first phase of the expansion was expected to be completed by July next year.
This is assuming the project secures environmental approval by July this year.
The second phase was expected to be operational by November next year.
Sasol is building the extra storage capacity due to the increase in the number of the group's service stations, as well as the finding by the Moerane commission in 2005 that the local fuel industry was facing a major shortage of storage and gantry capacity, Van der Merwe said.
The group now has more than 400 service stations, after opening its first in 2004.
Shares in Sasol closed 1.45% or R4.25 firmer at R298 on the JSE on Wednesday.
The stock has gained 18.25% or R46 this month to date.