South Africa: Media Statement - Mineral Resources and Energy Committee Undertakes to Supporting Petrosa to Get Back to Profitability


The Portfolio Committee on Mineral Resources and Energy has conducted inspection-in-loco at the PetroSA Gas-to-Liquid (GTL) refinery in Mossel Bay and noted the existence of a turnaround plan that is approved by the board of the Central Energy Fund (CEF) Group.

Although acknowledging that PetroSA has already begun some work to implement the plan, the committee has called for a speedy approval of the plan by the executive authority of the Department of Mineral Resources and Energy (DMRE).

The committee can only express its view on the plan after approval by the executive authority.

PetroSA (GLT) is currently running production at a minimal scale due to a critical decline of indigenous gas feedstock supply, and the committee is of the view that the urgent implementation of the turnaround plan is required in order to bring the company back to profitability and save jobs.

In 2012, PetroSA embarked on a R14 billion exploration initiative that did not yield any positive results, namely Project Ikhwezi.

The committee has asked to be provided with a list of names of the individuals who were involved in the project who are still with the department, PetroSA and the CEF Group, as well as consequence management report.

It also noted an undertaking by the board of PetroSA to brief the committee on Project Ikhwezi losses.

After meeting exclusively with the organised labour at the PetroSA (GTL) refinery, the committee held a view that it should be provided with all forensic reports that are available, including the one on Project Ikhwezi.

The committee further conducted inspection-in-loco at the two storage facilities where the DMRE stored 2 000 solar water geyser units, and later met with the Mossel Bay Local Municipality.

The committee then noted that despite the solar water geyser project having started in 2013, the units were only delivered in April 2019, and that only five have since been installed as a training pilot.

On the other hand, the Mossel Bay municipal manager expressed a concern with regard to the state of PetroSA, in which the municipality believes that its economy and that of the district would be greatly affected by the closure of PetroSA.

The committee noted the concern and encouraged that there be bilateral engagements between the chief executive officers of PetroSA, CEF Group andt the Mayor.

Lastly, the committee will consider and adopt an oversight report, which will outline key observations and recommendations on Wednesday, 25 November 2020.

The committee Chairperson, Mr Sahlulele Luzipo, said the report will also acknowledge elements of the turnaround plan that threatens job security, because he strongly believes that job losses should be a last resort.

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