Sapref indefinite closure sparks concern over job losses

Organised business and environmentalists say while the indefinite closure of the Shell & BP SA Petroleum Refineries (Sapref) spells good news for the environment and pollution-affected communities, there is concern about job losses and the impact on the local economy.

The company announced a spending freeze and a pause on refinery operations no later than the end of March 2022.

For decades environmentalists have lobbied against the pollution linked to the Sapref refinery. Several independent health studies detail the prevalence of cancer in South Durban’s nine communities next to the refinery, was 24 times higher than in other parts of the country.

Some environmental organisations even refer to South Durban as “Cancer Alley” saying there are soaring numbers of cancer cases found in Shell and BP’s backyard.

A joint Shell and BP statement said the pause is for an “indefinite period” but with a restart possible in the future, including in the event of any future sale. The Durban-based refinery established in 1963 is the largest crude oil refinery in SA and supplies a third of the country’s fuel supply (35%).

The decision would have no impact on full-time employees, but organised labour believes the move will translate into severe economic losses for the province.

KwaZulu-Natal is in the throes of a slow economic rebuild, brought on by the Covid-19 pandemic and the subsequent devastation of the July 2021 unrest and looting.

The national Minara Chamber of Business said there are two ways of interrogating the impact of the closure.

“In the first instance it is the repercussions to the economy. Loss of jobs, impact on the businesses surrounding the refinery and the negative effect on downstream businesses supplying it,” said president Solly Suleman.

The second was the positive benefit to the residents and the environment. “Pollution has been a problem impacting on the health of the population in the vicinity of Sapref,” he said.

The Durban Chamber of Business expressed concern on the economic impact and called on the government and its investment promotion agencies to re-evaluate its business retention and expansion mechanisms.

“We continue to feel the residual effects of Covid-19. If we don’t work together to find sustainable solutions, we can expect to see many other large firms disinvesting or suspending operations,” said Durban Chamber president Nigel Ward.

“As organised business we believe it is essential for government to work together with the private sector to create an investment environment which is attractive and hospitable to investors both local and foreign,” he said. “We believe that dialogues between the public and private sector are non-negotiable. Both parties will achieve more through meaningful discussion.” 

Environmental activists in the region said the news brings hope after years of campaigning against the ill health of the community. But they are also concerned about the impact this would place on an already burdened transport industry to be used to transport cleaner fuels at much cheaper prices.

The South Durban Community Environmental Alliance (SDCEA) that represents over 20 community and environmental bodies, says while it is delighted that Sapref is taking a “pause”,  it is shocked that there was no consultation with the community that has borne the brunt of decades of pollution.

“We now insist on a permanent shutdown of this old rust-bucket refinery as part of decarbonisation,” said SDCEA coordinator Desmond D’Sa. “But at the same time, Sapref owes a vast ecological debt — including climate-damage reparations. It is a perfect opportunity to detox the Merewent-Isipingo-Umlazi zone where the refinery has done so much damage.” 

The SDCEA will meet the government’s National Planning Commission within the next two weeks as it says both Shell and BP should be held accountable for reparations for all affected by past and present harms. The increased traffic especially on the Bluff side of the Durban Harbour will need urgent redress.

“The entities’ close relationships with government and political parties here and across the world repeatedly demonstrate the need to nationalise the energy industry everywhere, urgently, so that a sane decarbonisation can proceed and just transition detoxification (a process that secures the future workers and communities in the transition to a low carbon-economy) can begin,” D’Sa said.

“Changing the Sapref site into a case study of eco-social transformation will be a superb task for us all,” he said.