EDITORIAL: What lessons from the PetroSA calamity?
The great irony is that PetroSA’s private sector comparator Sasol has been a remarkable success since it was weaned off government subsidies in 1997
The travails at state-owned petroleum firm PetroSA demonstrate in graphic form why it’s so important to separate state functions from risk-based enterprises. Although the calamitous financial failure of the company has been known for some time, the parliamentary portfolio committee on energy was on Tuesday formally told about the persisting dimensions of the disaster. The short version of this long and tortuous history is that the gas-to-fuel company essentially ran out of feedstock a few years ago and it consequently took a massive bet on finding new gas fields. This effort, the failed Ikhwezi ocean-gas project, resulted in a breathtaking R15bn loss in 2016. On top of that, the energy committee was told of a further R1.1bn impairment for the current 2016-17 financial year. In total, the loss is the biggest yet recorded for a state-owned enterprise. Following the Ikhwezi disaster, a forensic report was commissioned and it found that although there may have been some irregularities a...
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