• The Western Cape High Court has made a ruling, reversing the sale of SA’s strategic crude oil reserves which took place in 2015.
  • In a joint statement, the Strategic Fuel Fund and the Central Energy Fund says there will be consequence management for implicated employees.
  • The SFF will refund monies with interest accrued.

The Western Cape High Court has made a ruling, reversing a 2015 sale of SA’s strategic crude oil reserves, which arguably was below market value and cost the country financial losses.

The Central Energy Fund (CEF), and its subsidiary, the  Strategic Fuel Fund (SFF) issued a statement  on Friday, welcoming the ruling.

The matter was heard in the high court in September. In 2015, the SFF had sold 10 million barrels of strategic crude reserves to nine oil traders for R5 billion, considered well below market value. The stock is estimated to cost R7 billion to replace, Fin24 previously reported. According to the CEF and SFF, the former CEO of the SFF, Sibusiso Gamede had unlawfully concluded the sale of the agreements. Tina Joemat-Pettersson was energy minister at the time.

“We are vindicated by this high court ruling. If these unlawful transactions were left unchallenged, the country would have suffered huge financial losses given the repurchase price of the oil reserves at the prevailing market rates,” said current CEO of the SFF, Godfrey Moagi.

“As a company, we would ensure that all measures are in place to institute consequence management against all employees cited in the case for wrongdoing, particularly those who are still in the employ of SFF,” said Moagi.

All traders have agreed that the sale of the strategic crude oil reserves were invalid. And as part of the high court settlement, the Strategic Fuel Fund (SFF), a subsidiary of CEF would refund all monies paid to it with interest accrued.

Aa hedge loss award was made to the traders, but the CEF and SFF are seeking legal advice with the intention to appeal.

Mineral Resources and Energy Minister Gwede Mantashe previously told Parliament that “culprits” in the matter will be dealt with.