We already have Nkandla, the nuclear procurement deal, Eskom, SAA and several other national dramas, but did you know that South Africa has sold its entire stock of strategic fuel reserves? Yep…SA is one of the only countries on the planet to have sold all its fuel reserves. We have nothing even though the International Energy Agency recommends that countries keep 90 days worth of reserves given that a lack of reserve fuel could cripple an economy. Not only that…the 10 million barrels of reserve fuel stock was sold at a massive discount in December last year and it hardly made the news. The fuel was quietly sold at $28 a barrel and if we wanted it back we would have to pay around $45 per barrel.
Some industry experts believe that the bargain sale of our fuel reserves lined the pockets of those behind the deal to the tune of over a R1 billion.
I recently read the an article about the sale of our strategic fuel reserve and it’s pretty mindblowing when you actually consider where we currently sit.
“Bottom line, somewhere between $100-million and $150-million has disappeared because of bribery and corruption?
A significant number of oil market participants would say (and have said), “Absolutely, yes”. My figure of $10 a barrel wasn’t meant to be inaccurate, but it is representative. Whichever way you look at it there’s a minimum of $10 a barrel and it rises to $15 on an optimal sale. The crucial factor is why wasn’t there a public tender including Chevron and a global community of capable, financially sound oil trading companies and other oil majors, including all of those active in South Africa? At every other interaction with the South African Government’s SOE’s there are tenders, there’s transparency, there’s competition. Yet not here….”
Go read the full ‘Oilgate’ article on BizNews HERE.
Now you know.