PetroSA merger to form South African National Petroleum Company
In South Africa, the portfolio committee on mineral resources and energy was recently briefed by the department of mineral resources and energy on the merger of iGas, PetroSA and Strategic Fuel Fund (SFF). The iGas, PetroSA and SFF are subsidiaries of the Central Energy Fund (CEF) group, which is a state-owned company, and their merger is effective from 1 April 2021.
The new entity that will emerge out of the merger will be called the South African National Petroleum Company. The committee expressed a reservation with regard to the department’s likelihood of meeting the merger deadline, considering the existing legislative regime, pending issues raised in the SFF and PetroSA’s forensic reports, as well as PetroSA’s current insolvency and liquidity challenges. The department, on the other hand, highlighted as a significant risk any delay in the approval of the merger archetype by Cabinet.
On the forensic reports, the committee heard that investigations at PetroSA and CEF are still underway and that SFF’s forensic report regarding 300,000 barrels of crude oil allegedly loaned to Enviroshoe without proper approvals is with the Hawks for further investigations. The CEF and SFF’s lawyers are currently looking into the consequence management process.
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