South Africa’s largest crude oil refinery, Sapref, said on Tuesday it was shutting down and declaring force majeure on contracts in the face of the ongoing social unrest partly triggered by the jailing of former president Jacob Zuma.
The Shell/BP joint venture made the announcement in a letter to clients.
“Sapref has been obliged to make the difficult decision to shut down the refinery.
“As a result of the aforegoing, Sapref hereby declares the occurrence of an event of force majeure, excusing Sapref from performing under the agreement,” the letter, dated 13 July, says.
“Due to the civil unrest in the country and disruption of supply routes in and out of Kwazulu-Natal, suppliers of materials critical to Sapref operations communicated the suspension of deliveries to the refinery due to safety concerns for their staff and damages to their vehicles on the roads.”
Sapref is South Africa’s largest refinery and accounts for 35% of the country’s refining capacity, according to its website.
The Engen refinery in Durban and the Chevron refinery are currently out of commission, leaving Natref, a joint venture operated by Sasol and Total, the only major source of refined fuel in the country.
The consequences in the pipeline for the wider economy are truly massive, with shortages of other goods and services that rely on the transport sector to get to market threatened. The damage of looting to South Africa’s economy, from the top enablers of State Capture to those on the streets today, is mounting. We are all poorer as a result. DM/BM
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