On Friday, 17 January 2025, the Department of Mineral Resources and Energy (“the DMRE”) held a virtual consultation with key stakeholders within the petroleum industry to discuss the Petroleum Products Bill (“the Bill”). This follows written submissions subsequent to publication of the Bill in the Government Gazette in October 2024. 

Notably this Bill seeks to replace the existing Petroleum Products Act, 1977, with a view to aligning itself with evolving industry needs as well as governmental objectives to transform the industry.

The Bill has, however, received mixed reactions. 

Key stakeholders such as the South African Petroleum Industry Association (“SAPIA”) and the South African Revenue Service (“SARS”), along with various petroleum wholesalers who are trading fuel under the current Act, were permitted to present any concerns and provide recommendations during the workshop.

SARS for its part, recommended collaboration in relation to the enforcement provisions contained in the Bill, and suggested that their team assist in the inspection process of licensed premises contemplated in section 22 of the Bill. Pursuant to their recommendation, was their assertion of the Bill being aligned with the relevant provisions of the Customs and Excise at 91 of 1964 to bolster compliance on all fronts. 

It was apparent, however, that much work needs to be done before this Bill is promulgated.  By way of illustration, and aside from the proposed piece of legislation bestowing a wide range of discretionary powers on the Minister of Energy, the Bill places a heavy administrative burden on “end - users” as defined therein. These are the entities that buy petroleum products from fuel wholesalers for their own use. The bill places all end-users in a difficult financial position by making it mandatory for them to construct their own facilities and obtain certificates, should they wish to acquire fuel.  SAPIA noted that such an imposition on end-users can impede the efficiency of the fuel industry, which is one of the very objectives that the Bill seeks to achieve.

Whilst it remains to be seen what revisions to the Bill will follow from these types of workshops, it is submitted that collaboration between industry and the DMRE will go a long way to positioning the petroleum industry and the Republic in an economically advantageous position. All key stakeholders should seek to partake in the collaborative process, set out by the DMRE, to ensure that this goal is achieved.