South Africa pressing US firm on Iran trade
South African refineries are in talks to resume imports of Iranian crude oil when sanctions are lifted on Tehran, Iran’s Deputy Petroleum Minister Roknoddin Javadi says.
Iran was the second supplier of crude oil to South Africa before the sanctions. Pretoria has said it never agreed with sanctions on Tehran and that its oil refineries had suffered immensely from the ban.
South African officials have repeatedly negotiated resuming supplies from Iran, with the last talks held in Tehran just “a few weeks ago”, said Javadi who is also managing director of the National Iranian Oil Company (NIOC).
South Africa’s third largest refiner is in talks with Chevron which operates a refinery in Cape Town to resume crude imports from Iran.
At least half of the eight crude refineries in South Africa are operated by global oil majors, including BP, Royal Dutch Shell, Total and Chevron.
Sasol, which is jointly operating the Natref refinery with Total, had a $900 million joint venture with Iran’s National Petrochemical Company through the Arya Sasol Polymer Company (ASPC) which operates two polyethylene plants in Iran.
The company halted activities and ceased importing Iranian crude in 2012 when South Africa bought its last cargo of around 68,000 barrel per day from Iran in May of that year.
Sasol also planned to develop Iran’s first GTL project but it abandoned the scheme in 2006 over technicalities and outside pressures against investment in the Islamic Republic.
With the lifting of sanctions on the horizon, South African leaders have indicated interest in resuming trade links with Iran.
In May, South African Energy Minister Tina Joemat-Pettersson visited Tehran and announced her country’s readiness to establish a cooperation framework in oil, LNG, LPG, gas and petrochemical sector.
In September, Deputy Oil Minister Thembisile Majola said South Africa planned to build a new oil refinery which will use Iranian crude.
Iran plans to ramp up oil exports, with Javadi saying the country will add 500,000 bpd to its output “in the next few days” when sanctions are removed.
“In the post-sanction era, about 60% of the rise in Iran’s oil sales will be for the Asian markets and the rest of supplies will go to the South African and European markets,” he said.
Javadi said Iran had already lined up its customers for a stepped-up production and had no worries to sell additional barrels.
“Moreover, all the oil production, transfer, storage and export installations and terminals are fully ready to raise exports,” he added.
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