Court to determine if SA still has access to its strategic fuel stocks

Cape Town - The Strategic Fuel Fund’s 2015 sale of 10 million barrels of South Africa’s strategic fuel reserves will be contested in court, and the case's outcome will determine if the SA in fact has access to the fuel stocks at all.

This was according to acting Strategic Fuel Fund (SFF) CEO Thabane Zulu, who spoke to journalists on the sidelines of a Parliamentary briefing on Wednesday.

The secret sale by the SFF, which is a subsidiary of the Central Energy Fund (CEF), took place in December 2015, at a time when oil prices were at a historical low point.

Zulu and a delegation from the CEF and PetroSA briefed Parliament's oversight committee on energy on the entities' annual financial statements.

Zulu told journalists that the court would also determine if South Africa could buy back the stocks if needed.

Zulu said the court proceedings would be based on a legal opinion with recommendations which had been commissioned by the former minister of energy Tina Joemat-Pettersson.

"So the process has started to give effect to the recommendations made by the legal team," he said.

Zulu said that, on the basis of the legal opinion, South Africa does in fact have access to strategic fuel stocks. But he said this needed to be tested in court.

As Fin24 reported earlier in the week, the chairperson of the CEF's board Luvo Makasi could not yet say what price South Africa had paid for the controversial sale of the stock, nor who now owns the stock at the moment.

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. But this was refuted by her successor Mmamoloko Kubayi who acknowledged in May 2017 the stock had in fact been sold. 

In an interview with Power 98.7 radio host Onkgopotse JJ Tabane on Monday evening, Makasi also acknowledged the stock had been sold and not rotated.  

He added that the CEF board was only involved in the transaction “at the end”, saying the board only got wind of the sale when a “a good amount landed in our (bank) account”. 

SUBSCRIBE FOR FREE UPDATE: Get Fin24's top morning business news and opinions in your inbox.

Read Fin24's top stories trending on Twitter:

ZAR/USD
16.33
(-0.06)
ZAR/GBP
21.08
(-0.04)
ZAR/EUR
19.33
(-0.03)
ZAR/AUD
11.90
(-0.03)
ZAR/JPY
0.16
(-1.15)
Gold
1949.72
(+0.03)
Silver
26.74
(+0.09)
Platinum
928.80
(+0.44)
Brent Crude
43.52
(-0.32)
Palladium
2356.01
(+0.63)
All Share
54673.65
(-0.66)
Top 40
50399.16
(-0.59)
Financial 15
9841.32
(-2.14)
Industrial 25
72558.00
(-1.08)
Resource 10
55438.10
(+0.58)
All JSE data delayed by at least 15 minutes morningstar logo
Company Snapshot
Voting Booth
Do you think it was a good idea for the government to approach the IMF for a $4.3 billion loan to fight Covid-19?
Please select an option Oops! Something went wrong, please try again later.
Results
Yes. We need the money.
11% - 1297 votes
It depends on how the funds are used.
73% - 8622 votes
No. We should have gotten the loan elsewhere.
16% - 1898 votes
Vote