Johannesburg — SA's fuel companies have applied for an exemption from competition legislation that prohibits industry players from entering into agreements that contravene competition law.

According to a notice dated December 18, the exemption will ensure the continuity and stability of liquid fuels supply. Fuel industry players have emphasised it is crucial for them to hold discussions on supply security matters.

The fuel industry, through the South African Petroleum Industry Association (Sapia), has applied for an exemption from the Competition Act. Sapia represents BP Southern Africa, Engen Petroleum, Chevron SA, Sasol , Shell SA Marketing, Total SA and national oil company PetroSA.

Sapia wants the exemption to last six years. It remains to be seen if the Competition Commission will grant the industry its wishes. Interested parties have 20 business days since the publication of the notice to make written representations on why the exemption should not be granted.

The move will allow the industry to return to the old practice of joint planning and

co-ordination. Jet fuel shortages at OR Tambo International Airport prompted the application.

The exemption would, for instance, allow the industry players to co-operate in the use of Transnet's Durban-to-Johannesburg pipeline.

According to a recent notice in the Government Gazette, Sapia has applied to be exempted from certain provisions of the Competition Act. "The exemption application covers a range of agreements and practices which are required to ensure the continuity and stability of liquid fuels supply to the various sectors and geographical locations of the ... economy," the notice said.

It said the application included practices such as co-loading and co-freighting of crude oil. This would pave the way for the co- ordination of crude oil and unfinished liquid fuels imports "for the operation of port access, discharge and loading facilities".

It will also allow the companies to enter into co-ownership and management agreements in relation to the single-buoy mooring facility, which is a loading buoy anchored offshore that serves as a mooring point and interconnection point for tankers loading or offloading gas or liquid products.

The companies will also be able to co-ordinate the use of infrastructure for transport of liquid fuels to depots and terminals. This will mainly relate to the use of the Transnet pipeline. A pipeline is a safer, cheaper way to transport fuel products from coastal refineries to the inland market.

The companies want to be able to share with the Department of Energy and among themselves information relating to liquid fuel stocks held by each oil company , as well as schedules for actual and intended distribution of liquid fuels through coastal shipping, pipelines, rail and roads.