Sapref refinery in iSipingo, south of Durban, Picture: Doctor Ngcobo/Independent Newspapers
Mineral and Petroleum Resources Minister Gwede Mantashe has welcomed the Competition Commission’s approval of the Central Energy Fund’s (CEF) application to acquire the various assets that collectively comprise the Sapref Refinery.
In May, the state-owned CEF made a bid for Sapref Refinery, South Africa’s biggest fuel refinery, from bp Southern Africa and Shell Downstream South Africa (SDSA), for an undisclosed sum.
Mantashe on Saturday said this approval was the culmination of the conclusion of the Sale Purchase Agreement with bp Southern Africa and SDSA for assets located at the Sapref precinct to CEF.
The sale includes the SDSA and bpSA interests in the Sapref land and other associated assets, which includes crude and finished product tanks, process units, pipelines to and from Sapref to Island View terminal, and the single buoy mooring for crude imports.
The sale excludes Sapref (Pty) Ltd, bp’s marketing businesses, the Island View terminal operations and the lubricants blending and grease manufacturer, Blendcor (Pty) Ltd.
Mantashe said the acquisition of these assets will form the hallmark of CEF’s investment and growth strategy in the energy value chain geared to lay a solid foundation to address the challenges that lies ahead in the security of South Africa’s energy future.
“As a department charged with the responsibility of securing energy supply to power the South African economy, we have seriously noted with concern the declining local refining capacity, which resulted in the country becoming a net importer of refined petroleum products,” Mantashe said.
“This new emerging trend was not only threatening the country’s economic stability and security of supply of petroleum products but also meant the exportation of jobs that are so needed in the country given the stubbornly high level of unemployment.
“Therefore, the commission’s approval is important because it does not only authenticate the acquisition, but reinforces South Africa’s concerted efforts aimed at guaranteeing adequate supply of liquid fuels in the midst of premature closures of refineries.
“The acquisition of Sapref, and its revitalisation thereof, will ensure that South Africa, through CEF, continues with the exploitation, development, and distribution of petroleum products.”
BUSINESS REPORT