Johannesburg — SOUTH African oil groups would seek exemption from competition authorities to revive joint planning and co-ordination in the industry, the SA Petroleum Industry Association (Sapia) said yesterday.

The move, which will set a precedent, is seen as vital in efforts to ensure security of supply for liquid fuels, and was prompted by a recent shortage of jet fuel at OR Tambo International Airport.

In the past, the industry had joint co-ordination because of shared logistics infrastructure such as the Transnet petroleum products pipeline form Durban to Gauteng. But that stopped with the advent of the competition law restricting such practices.

The association confirmed yesterday that it was in the process of reviving a degree of co-operation.

"There is a need to get an exemption that allows this type of planning to go ahead," Sapia chairman James Seutloadi told MPs.

"We compete very fiercely on a day-to-day basis, but there are times when we need to get together," he said. Sapia represents the seven big oil groups in SA.

The exemption clause of the Competition Act allows companies to engage in anticompetitive practices in specific circumstances such as the promotion of exports or to ensure economic stability.

Nandi Mokoena, Competition Commission head of strategy and stakeholder relations, said yesterday the body was aware of Sapia's intentions to seek an exemption.

"They have been speaking to us, but at the moment there is no exemption application before the commission," Mokoena said.

Sapia executive director Avhapfani Tshifularo said the industry was yet to table the application to the commission.

"We are still working on it. We used to be able to plan together. We want to be able to do that again," Tshifularo said.

He said the exemption would apply to various petroleum products. The industry wanted exemption so that there could be co-operation, for example, in the use of the Transnet pipeline.

The transportation of fuel to the inland economic hub has come under the spotlight with Transnet's existing pipeline from Durban to Gauteng operating at full capacity. As a result, fuel companies have to resort to more expensive road and rail transport.

This has heightened fears of a looming crisis in security of supply.

Transnet and Petroline, a private company , are building pipelines that will transport petroleum products inland from Durban and Mozambique.

Transnet's new multi- product pipeline from Durban to Gauteng will come on stream at the end of 2011, and Petroline's facility from Mozambique to Gauteng will be commissioned in early 2011.

Tshifularo said joint planning and co-ordination had proved vital in averting a repeat of the fuel crisis that hit the OR Tambo airport this month.

Jet fuel levels at the airport fell to about two days' supply, although the acceptable global benchmark is five days.

The drop in the fuel stocks prompted Energy Minister Dipuo Peters to set up a task team that included representatives of the Department of Energy, Sapia, Transnet and Airports Company of SA (Acsa). The task team will develop a liquid-fuel supply and logistics plan, and play a vital role in the planning for next year's Soccer World Cup.

The OR Tambo airport is s outhern Africa's air transport hub, handling more than 17-million passengers each year, according to Acsa. The airport has nine storage tanks with a combined capacity of 46500m³.

At the height of the recent jet-fuel crisis at the airport, Acsa asked airlines to cut fuel usage 30%.

"The situation at OR Tambo has gone back to normal. There is enough stock of jet fuel," Seutloadi said.

Peters said recently the jet-fuel crisis had been resolved. With Bloomberg