OWN CORRESPONDENT AND REUTERS, Johannesburg | Saturday
THEBE Petroleum Corp (Tepco) has become the first black-owned South African petroleum company to enter the country’s aviation fuel market after striking a two-month, R62m deal with South African Airways Cargo (SAA).
The deal will see Tepco supply 10m litres of aviation fuel to SAA at Cape Town International Airport and Johannesburg International Airport, according to Morakile Shuenyane, Tepco’s chief executive officer.
Tepco is 70% owned by black empowerment firm Thebe Investments, while SAA, which is 20% owned by Swissair, is Africa’s largest airline.
The entry requirement of $1bn insurance cover for the South African aviation industry makes it difficult for local black firms to enter this sector.
On September 1, Tepco entered into a joint venture agreement with Shell South Africa, under which Shell will assist Tepco with distribution, storage and pumping facilities.
“Shell made it possible for us to become a player in the aviation industry by extending its insurance cover to Tepco,” Shuenyane said. “The partnership provides the expertise, technology and equipment to meet our contractual obligations with SAA.”
Tepco will rely on its partnership with Shell to bid for the SAA aviation fuel tender at the end of this year.
Last year, Tepco and Shell entered into a refining agreement which gave Tepco a seven percent stake in Shell and BP South Africa’s refining business.