Johannesburg – Mineral Resources and Energy Minister Gwede Mantashe has made positive comments on the recent finalisation of the sale purchase agreement between BP Southern Africa (Pty) Ltd (BPSA) and Shell Downstream South Africa (SDSA).
In a statement on Saturday, (25 May 2024), Minister Mantashe expressed his satisfaction with the agreement that involves assets situated at the precinct of SAPREF, the largest crude oil refinery in the country.
These assets have been sold to the South African State-owned entity, Central Energy Fund SOC Ltd (CEF).
The transaction encompasses the transfer of SDSA and BPSA interests in the SAPREF land and other associated assets, which include critical infrastructure such as crude and finished product tanks, process units, pipelines connecting SAPREF to the Island View terminal, and the Single Buoy Mooring utilised for crude imports.
However, Minister Mantashe said it was important to note that the sale excludes SAPREF (Pty) Ltd, BP’s marketing businesses, the operations of the Island View terminal, and the lubricants blending and grease manufacturer, Blendcor (Pty) Ltd.
“The acquisition of these assets marks a pivotal step in CEF’s investment and growth strategy within the energy value chain,” the minister said.
“It is strategically aimed at establishing a robust foundation to tackle the challenges confronting South Africa’s energy security in the foreseeable future.”
The Department of Mineral Resources and Energy (DMRE), entrusted with the crucial task of ensuring a stable energy supply to drive the South African economy, said it has “observed with concern” the dwindling local refining capacity.
“This trend has led to South Africa transitioning into a net importer of refined petroleum products,” the department said.
“Beyond the economic implications, this shift posed a threat to the country’s energy security and jeopardised local job opportunities.
“The acquisition of these assets by CEF signifies a proactive measure to counteract these challenges and reinforce South Africa’s energy resilience.”
The statement said Minister Mantashe extended his appreciation to the negotiating teams involved in facilitating the deal.
“Despite encountering obstacles such as the KwaZulu-Natal floods, which were beyond their control, their unwavering dedication ensured the successful conclusion of this vital agreement,” the statement said.
