Minister admits South Africa’s oil reserves were sold, not ‘rotated’

New energy minister, Mmamoloko Kubayi has admitted that the controversial ‘rotation’ of South Africa’s oil reserves in 2016 was in fact a sale – flying in the face of the defence put forward by her predecessor, Tina Joemat-Pettersson.

Speaking to Parliament’s portfolio committee on energy on Tuesday, Kubayi confirmed that the department sold 10 million barrels of oil at a extremely low price of $29 a barrel to private enterprises.

When news of the ‘secret’ sale broke in May last year, then-energy minister Joemat-Pettersson said that it was not a sale, but rather a rotation of old oil, which the department was within its rights to execute.

The sale of the oil was seen as putting South Africa at a huge risk, while effectively robbing the country of billions of rands, as the oil was sold at a price $20 dollar cheaper than the listed price at that time.

It also left the country vulnerable, with only enough oil in reserve to sustain the country for less than a day. There is supposed to be enough oil in reserve to cover 20 days – which is in itself much lower than the 90 day international average.

Kubayi did not update Parliament on the state of the country’s current reserves, but confirmed that the sale was in fact a sale, not a rotation.

Responding to the admission, the DA said that Parliament had been misled and that heads needed to roll, pointing out that the deputy minister, who had been party to the denials in the wake of the scandal, is still in her position.

Read: Government ‘secretly’ sold off R5 billion worth of SA oil reserves – and got ripped off

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Minister admits South Africa’s oil reserves were sold, not ‘rotated’