Kubayi defends Joemat-Pettersson over fuel stock sale

Cape Town - Energy Minister Mmamoloko Kubayi on Tuesday said her predecessor did not intend to mislead Parliament about the Strategic Fuel Fund's (SFF) stock sale.

Her department was considering laying criminal charges against those involved in the sale of strategic fuel stock, she told Parliament’s energy portfolio committee.

READ: Criminal charges in the pipeline for fuel fund execs - minister

In December 2015, the fund sold 10 million barrels of South Africa’s strategic oil reserves at a substantial discount to market prices, in a “closed tender” to energy traders Taleveras, Glencore and Vitol at $28 a barrel, the Mail & Guardian reported on May 5.

The department's probe, launched last year into the SFF's attempts to buy assets, implicated SFF executives in irregular procedures, Kubayi said. They did not know where the money had gone yet, but certain individuals benefited.

Opposition MPs grilled Kubayi over her predecessor Tina Joemat-Pettersson's role in the sale, after she announced it during the 2016 budget vote debates.

Kubayi said she wanted to give Joemat-Pettersson the benefit of the doubt, as everyone believed at the time that the sale was a stock rotation.

"All along, everybody believed it is a rotation. So I don't think there is anyone, either the former minister [or anyone else], who mislead Parliament, unless forensics prove otherwise."

DA MP Gordon Mackay commended Kubayi, who had been in the job for two months, for her cool head. He however warned her against defending her department’s officials too quickly.

Kubayi said she wanted to handle the information correctly, as the department's report into the sale could be contaminated otherwise.

She said she needed to be satisfied that nobody in her department was implicated in the report, before showing it to them.

Central Energy Fund board chairperson Luvo Makasi told MPs they were considering the implications of the report. The CEF is the parent company of the SFF.

"When the report came to light, your legal position depends on the direction you take. You have to find a balance between the two positions you take.”

The fund’s four board members had been asked to explain their involvement.

"We are in the process of also getting the SFF board to implement our directives related to reasons for their suspension. From a board point-of-view, we will be getting those presentations and feeding them to our shareholders."

There was a possibility the sale could be declared void, as the board had not properly signed off on it and because Treasury had concerns about it.

The CEF accepted the resignations of chairperson Riaz Jawoodien and acting chief executive Sibusiso Gamede in July last year, following the decision to probe the deal.