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Sat Apr 19 21:41:15 SAST 2014

BP investing billions in South Africa

Sapa | 23 April, 2013 13:58
A BP logo is seen on a petrol station in London November 2, 2010. BP lifted its estimate of the likely cost of its Gulf of Mexico oil spill to $40 billion on Tuesday, denting profits, but its underlying performance beat all expectations on higher refining margins and a lower tax rate.
A BP logo. File photo.
Image by: SUZANNE PLUNKETT

BP will invest nearly R5 billion in South Africa as a sign of its faith in the direction the country is heading, the energy company said.

"With the improving investment climate, especially policy stability... being presented in Southern Africa, BP has decided to invest significantly for the benefit of all of our stakeholders," British Petroleum (BP) refining and marketing chief executive Iain Conn told reporters in Johannesburg.

"It gives me great pleasure to announce that BP will be investing in excess of R5bn in Mozambique and South Africa over the next five years, commencing in 2013, which will be new plant and infrastructure upgrades."

It would be funded from BP cash reserves. Conn said R800 million would be invested in Mozambique, and R4.7bn in South Africa.

"This investment is designed to improve safety, customer experience, operational efficiency, help with government to improve energy security, and enable the transition towards cleaner fuels."

Conn said R2.5bn would be invested in upgrading refinery infrastructure at the SAPREF refinery, its joint venture with Shell in KwaZulu-Natal.

Over R1bn would be invested in terminals in South Africa and Mozambique.

The balance of the investment would be in the "retail network".

He said the investment was approaching five percent of all the capital that went into the marketing, refining, and chemical business of BP, which was currently represented in 70 countries.

"We are encouraged by the progress being made in South Africa and Mozambique to establish an environment of policy certainty and continuity for all economic activities," Conn said.

"In South Africa, I am conveying our appreciation to the government for adopting the National Development Plan as the blueprint for tackling the many challenges that continue to face this great nation."

Energy department director general Nelisiwe Magubane said government "endorsed and welcomed" the investment.

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Sat Apr 19 21:41:15 SAST 2014 ::