Astron Energy has confirmed that it will be producing cleaner fuels by 2027 at its Cape Town refinery even if government misses another deadline.
South Africa’s Cleaner Fuels 2 (CF2) specification will herald the nationwide introduction of cleaner propellants with lower Benzene content.
“The original date for Clean Fuels 2 was 2023, and in between Covid and everything else… we weren’t sure is this going to be an investment that is going to be return bearing or not,” said an Astron Energy spokesperson, as quoted by SABC News.
“Be that as it may, I can say we’ve taken the investment decision to actually make that investment in clean fuels… we will be supplying compliant fuels by the date that’s been asked.”
The introduction of cleaner fuels in South Africa, even if just from one supplier, could be a massive boon for the new-car market.
Automakers including Ford, Toyota, and VW stated they can’t launch their most cutting-edge products in the country due to poor fuel standards as the engines would be unable to perform at their peak.
Another extension looking likely
The CF2 specification was supposed to take effect in South Africa in July 2017, and then again in 2023.
However, regulatory hurdles and, later, the Covid-19 pandemic paired with the sudden closure of four out of the nation’s six refineries, complicated things, leading to the deadline being extended twice.
While we’re still two years out from the new date of implementation, it’s looking likely that it may again be surpassed.
Last year, the Fuels Industry Association revealed that government is busy resurrecting two refineries, the Sapref facility in KwaZulu-Natal it purchased for R1 from Shell and BP, as well as the state-owned PetroSA refinery in Mossel Bay.
Sapref is capable of producing approximately 180,000 barrels of refined petroleum per day, whereas PetroSA can do around 45,000 barrels.
The powers that be want to bring these refineries back into commission by 2027 to reduce the country’s dependence on imported fuels and, by extension, the risk of fuel shortages.
However, the plans are more ambitious than that.
Government further intends to upgrade the two refineries to be CF2 compliant, as well as turn Sapref into a mega refinery that produces no fewer than 400,000 barrels of petroleum a day, all within a matter of two years.
“We need to build a refinery, whether it’s at Sapref or elsewhere,” said Deputy Director General for Minerals and Petroleum Regulation, Tseliso Maqubela, earlier this year.
“[And] we can’t have a Sapref that comes back at 180,000 barrels per day. Sapref must come back at 400,000 barrels per day or more.”
Industry experts have, however, tempered expectations, highlighting that grandiose government initiatives such as these have been known to falter in the past.
“There’s the old Sapref refinery that the government-owned Central Energy Fund bought for R1, but what they didn’t say is they also bought billions of rands of environmental liability,” said Dr. Rod Crompton, visiting adjunct professor at the Wits School of Business’ African Energy Leadership Centre.
“I believe the Minister of Mineral Resources and Energy has been talking about revamping that refinery and revitalising it. Remember, it was flooded, and BP and Shell decided not to fix it after the floods, so [government] has to fix that and then get it working and then invest for the cleaner fuel specification, so most people in the industry are very sceptical that government would be able to do that. If you look at the way PetroSA has behaved, its corporate record is not too promising.”
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