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Forensic probe into 2015 sale of strategic fuel stocks complete - Mantashe

Jul 10 2019 06:01
Jan Cronje

A forensic probe into how South Africa's strategic fuel stock was sold off in late 2015 has been completed and will be submitted to Gwede Mantashe, Minister of Energy and Mineral Resources.

Mantashe wrote in a recent Parliamentary reply that the investigation had been wrapped up and the report would be tabled before the board of SA's energy holding company, the Central Energy Fund. The question had been posed by the DA MP Kevin Mileham.

The CEF's subsidiaries include national oil company PetroSA and the Strategic Fuel Fund. The report concerns the sale of 10.3 million barrels of SA's strategic oil reserves by the SFF in late 2015 at a price of around $28 per barrel, when the price of brent crude oil at the time was around $37-$44 per barrel.  

Rotated? No, sold off 

In March 2016 - three months after the sale took place - then-energy minister Tina Joemat-Pettersson claimed in her annual budget vote speech that the fuel had not been sold, but rotated. 

"In 2015, we issued a ministerial directive for the rotation of strategic stocks by the Strategic Fuel Fund and this has resulted in the increased revenue base for SFF, whilst at the same time maintaining stocks within our storage tanks for security of supply," she said at the time.  

But in early 2017 her successor, former minister of energy Mmamoloko Kubayi, admitted the stock had in fact been sold off.

At a Parliamentary briefing in May 2019, meanwhile, SFF board chair Neville Mompati told MPs a draft version of the report had recommended that the matter be dealt with on a criminal level.

"We want to believe and hope the issue will go to court, not as a settlement issue but as a criminality issue," he said. 

Later in May the CEF's chair Luvo Makasi was fired by ex-energy minister Jeff Radebe, who cited "serious allegations". The CEF has also separately applied to have the 2015 sale invalidated by a court.

Radebe, meanwhile, was replaced by Gwede Mantashe as minister of energy when Cyril Ramaphosa announced that the departments of mineral resources and energy would be merged. 

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