Vitol has declared a force majeure to end operations at Sunrise Energy's import terminal at Saldanha in the Western Cape as a result of Liquefied Petroleum Gas (LPG) shortages. Picture Henk Kruger/ANA
Vitol has declared a force majeure to end operations at Sunrise Energy's import terminal at Saldanha in the Western Cape as a result of Liquefied Petroleum Gas (LPG) shortages. Picture Henk Kruger/ANA

Businesses and the underprivileged are affected by Saldanha’s LPG port closure

By Aishah Cassiem Time of article published Jul 7, 2021

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VITOL has declared a force majeure to end operations at Sunrise Energy's import terminal at Saldanha in the Western Cape as a result of Liquefied Petroleum Gas (LPG) shortages.

Vitol said in a letter to its customers on June 28 that “it is with great regret that, due to unfavourable weather conditions in the port of Saldanha and at the MBM (multibuoy mooring system), our vessels that are scheduled to replenish stock at the import terminal have been delayed and that we were unable to replenish on LPG stock in tank at the facility.”

Vitol's Mariska de Jongh said the development forced the company to declare a force majeure since performances of the contract had been greatly affected by the weather conditions.

Last August, Sunrise Energy's facility also malfunctioned twice within a period of six weeks, making it unable to take delivery of LPG, also due to weather conditions.

Hermanus Gas's owner Stoffels Frick said the ongoing monopoly-related issue had not only affected local businesses, but also those who purchased from it, especially the poor.

“This is our season, winter, a time for consuming gas in the Western Cape. Last week I had a row of poor people sitting in my driveway waiting for bits and pieces to come in,” Frick said. “But I can't supply all, as I was supposed to get a load in yesterday, but only got half of it.”

Frick's company previously incurred losses of more than R500 000 due to the technical inadequacy of the sole importer of LPG in the province, and had last year called on the regulators to make provision for another LPG importer to enable it to continue.

Last year, Independent Media reported that the shortage of LPG in the province was a crisis caused by the poor regulation of infrastructure as well as the inadvertent existence of a monopoly structure pushing prices much higher than they should be.

Another businessperson, who preferred not to be named, said: “This is concerning. We need to have a stable supply, but Sunrise is trying its best to be successful in delaying and challenging the matter, and want a monopoly-based supplier in the Western Cape.”

Last year a tribunal said that the Transnet National Ports Authority and Sunrise ganged up on competing LPG importer Avedia Energy, making it virtually impossible for it to operate at Saldanha.

A source said Avedia should be allowed to continue importing alongside the berth in Saldanha.

“The question that is key in this matter is: knowing that we have shortages and issues for this period, with an effective facility that is currently in place in Saldanha, why do we still have these kinds of issues?

“Sunrise is the cause of what is currently happening and it should come to an end,” said the source.

Vitol head of corporate affairs Andrea Schlaepfer said: “It is quite common for adverse weather to impact our operations. As and when conditions improve and it is safe to do so, cargoes are discharged.”

Sunrise Energy chief executive Pieter Coetzee said they had not received the notice from Vitol.

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