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Afrox secures R1.1bn LPG contracts

Cape Town - South Africa’s largest gas and welding company African Oxygen (Afrox) [JSE:AFX] has signed two deals to supply liquefied petroleum gas (LPG), it announced in a JSE SENS statement.

Afrox, which deals with gases, hard goods and LPG signed a ten-year agreement to supply LPG to a major distributor in Lesotho.

"The contract with Gordons Enterprise is worth R1bn and will secure a new LPG filling site in the Maseru industrial development zone, thus providing a significant increase in storage, to supply the increased demand in the area."

It also signed a five-year agreement to supply LPG to a distributor partner in Mthatha, in the Eastern Cape. Afrox said this contract is worth R100m and will enable volume availability of LPG to rise by approximately 100% in the area.

"These two contracts demonstrate our ability to grow existing business with strategic partners, and enabling this is our supply-on-demand contract with global LPG supplier Petredec," Afrox managing director Schalk Venter said.

He said the company imported 30% of its LPG needs via Petredec and BTT in Richards Bay since May,

"This security of supply will be an engine for growth in the LPG market for Afrox."

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