South Africa’s Central Energy Fund (CEF) has announced that it has backup access to sufficient crude-oil stocks after its reserves were sold in 2015.

According to the Director of CEF, Tseliso Maqubela (photo), the fund, which controls the country’s reserves via the Strategic Fuel Fund, reassigned titles for 10 million BO to companies in December, 2015 as part of a stock rotation.“In an event of an emergency, the contracts stipulate that the fund has first right to the oil. The parties also must agree before any of the crude oil is lifted. Taleveras Group and joint ventures of Vitol Energy Ltd. and Glencore Plc bought the titles,” he said.

He added that after the rotation, South Africa now has rights to 90 days of reserves or 30 days more than required.

The Strategic Fuel Fund sold 10 million BO, nearly the total stock, leaving it with 300,000 barrels. The trade yielded $280 million for the fund.

At the beginning of this month, Energy Minister, Tina Joemat-Pettersson, revealed that the CEF’s Strategic Fuel Fund has a yearly income of $11 million from rotation of strategic stocks. The Department of Energy is the CEF’s primary stakeholder.

The fund perform the rotation due to the decline of the oil quality and also because the stock was a high-sulfur crude, which is not very environmentally friendly, Maqubela said, adding that South Africa uses around 450,000 bpd, Bloomberg reports.

Anita Fatunji