WEDNESDAY, 4.15PM:
FINANCE Minster Trevor Manuel on Wednesday confirmed reports that the Strategic Fuel Fund sold off “the bulk” of South Africa’s strategic oil reserves on government instruction, but denied that the money was sneaked into the Budget to boost revenue.
“It is important to put to bed any notion that we [sold off the oil] secretly,” Manuel said at a joint press conference with Mineral Affairs and Energy Minister Penuel Maduna.
Manuel and Maduna called a press conference to respond to allegations made by the United Democratic Movement on Tuesday, accusing the government of selling all its strategic coastal oil reserves, or at least depleting them below the Cabinet-authorised minimum levels. The UDM alleged the oil sale, conducted by the SFF, was aimed at raising revenue to allow the government to stick to its strict budget deficit targets.
On Wednesday morning, Business Day suggested that the sale had raised over R2-billion and that a portion of this had been “slipped” into the Budget. It pointed to a table in the Budget review listing R800-million in revenue for an unspecified “sale of stock”, as possible proceeds from the oil sale.
Manuel responded saying it was clearly stated in the Budget review that the R800-million proceeds from the oil sale, paid to the fiscus from the Strategic Fuel Fund, would not be included in revenue. Both he and Maduna refused to confirm the total amount of the sale, although Reuters quoted SFF acting general manager Brian Casey as saying that he received “instructions to sell sufficient crude oil to raise approximately R2-billion for the fiscus,” at the end of last year.
Casey said that January’s sale left South Africa with 10-million barrels in reserves, from the original 35-million barrels — a month’s supply of oil for the country.
Maduna would not disclose who had bought the oil.