Court reverses controversial sale of SA’s strategic crude oil reserves

Oil tanks. Picture: Shutterstock

‘If these unlawful transactions were left unchallenged, the country would have suffered huge financial losses,’ said Strategic Fuel Fund CEO Sibusiso Gamede.

The Central Energy Fund (CEF) and its subsidiary, the Strategic Fuel Fund (SFF), on Friday welcomed the Western Cape High Court judgment in reversing the sale of SA’s Strategic Crude Oil Reserves sold in 2015.

This landmark victory is a culmination of a series of court proceedings that the CEF and SFF Board launched after it discovered that the former CEO of the Strategic Fuel Fund, Sibusiso Gamede, unlawfully concluded a series of agreements, which resulted in the disposal of South Africa’s 10 million barrels of Strategic Crude Oil Reserves, the two entities said in a joint statement.

In welcoming the Western Cape High Court judgement, the SFF CEO, Godfrey Moagi said: “We are vindicated by this high court ruling. If these unlawful transactions were left unchallenged, the country would have suffered huge financial losses given the repurchase price of the Oil reserves at the prevailing market rates”.

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“As a company, we would ensure that all measures are in place to institute consequence management against all employees cited in the case for wrongdoing, particularly those who are still in the employ of SFF,” he added.

All traders have agreed that the sale of the strategic crude oil reserves were invalid, and as part of the high court settlement, the Strategic Fuel Fund (SFF), a subsidiary of CEF, would refund all monies paid to it with interest accrued, the statement said.

“As a Group, we are grateful that the Judge ruled in our favour to ensure that the ownership of these oil reverses are retained in South Africa and for its people,” said CEF Group CEO, Dr Ishmael Poolo.

Commenting further on the Judge awarding the traders a “hedge loss award”, Poolo confirmed that CEF and SFF are taking legal advice with an intent to appeal that part of the judgement, the statement concluded.

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