Airports company not expecting more fuel suppliers to quit SA after BP’s exit

Despite the country’s unstable power supply and occasional downward trajectory in international markets, Airports Company SA (Acsa) does not expect more fuel suppliers terminating services to airlines.   

Acsa told TimesLIVE, as one of the largest fuel suppliers, BP has terminated aviation fuel supply to South African airports starting from January. Some speculated BP's move was caused by concerns of exposure of international businesses to Russian businesses in South Africa amid the war in Ukraine. However, BP says the decision was purely strategic.  

The British oil and gas company was expected to stop supply at the biggest airport in the country, OR Tambo international airport, in May. It ended its aviation operations at Cape Town International Airport in January and will do so at the East London and George airports on Friday.    

BP will end its aviation operations at Durban's King Shaka International Airport at the end of April.

Speaking to TimesLIVE, Acsa OR Tambo airport regional manager Jabulani Khambule said the company had talks with fuel suppliers and did not anticipate any more of them terminating services.   

“We do not anticipate more companies leaving the country. South Africa’s international relations are quite good with most of the countries.    

“Even BP pulling out of South Africa has nothing to do with international relations; it is about their strategic focus as a business as to where they want to focus on and what areas of their business they deem not profitable to the number of resources invested in a particular area,” Khambule said.    

With a peak in demand expected at the airports this upcoming Easter holiday, Khambule said fuel security would not be in jeopardy because they had contracts with eight fuel suppliers.    

He said the company was also in talks with other fuel suppliers to make up whatever shortfall would be left by BP. Khambule was excited that a South African company, PetroSA, had applied to compete in the market for fuel supply.    

“PetroSA has applied to be a through putter (fuel supplier using Acsa’s storage facilities). They will operate and compete like all others through putters in the market for jet fuel supply.”    

Khambule said while PetroSA has not done business with Acsa before, he did not foresee challenges with the company.   

“Not to pre-empt the outcome of that application, I do not foresee challenges with them. There are regulatory standards they need to comply with to be granted that licence.    

 “I am excited to hear that PetroSA now wants to play a role in the supply of jet fuel. Most suppliers are international companies, we have a local company in the name of Sasol which is a major player in the space. But having two South African major players gives us a lot of encouragement.”    

Earlier this month Cape Town airport had a fuel shortfall after a major fuel supplier had refinery glitches caused by power problems. However, these issues seem not to deter Acsa, which announced a steady recovery in sales after the Covid-19 outbreak.    

Khambule said the company had a fuel supply forum consisting of the department of minerals, energy and resources, refineries, through putters and transport companies.    

“This is to make sure we have contingencies in place to ensure security of supply. Once we get information about fuel supply, I notify our fuel forum to convene urgently and come up with mitigating plans.”   

TimesLIVE

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