While I do agree that the oil industry is leveraging its strategic importance with the government regarding the clean fuel specification upgrade costs, however, I feel the closing of refineries only works if it is planned well in advance and a suddenly cut off at this point in time is anything but beneficial to South Africa as a whole.
As all vehicles currently in service are either running in petrol / diesel, and Sasol Secunda only supplies around 30% of the national fuel usage from its coal to liquid technology, the closing down of crude oil refineries means around a 70% shortfall of fuel generation capabilities. We might have enough strategic crude oil reserves for now, but without refineries to refine them into fuels and other petroleum products, the crude oil are pretty much useless.
While electrical vehicle is most probably the direction we are headed to for future automobile, its implementation is still years away in South Africa. Remember that we currently have insufficient electricity as it is, imagine how much more capacity we will need to fuel all these electrical vehicles. And then there are the infrastructure like thousands of charging stations which still need to be built, new SANS standards and regulations that will need to be drawn up implemented for electrical vehicles and its surrounding infrastructures (i.e. charging ports at home, charging stations around countries etc...). All these will probably take billions of rands and years if not a decade to plan and implement.
The closing down of refineries also means a sudden lost in tens of thousands of direct and indirect jobs, first, the refineries staffs will be unemployed, then the construction and engineering contractors will lose their jobs, the companies that supplies spare parts and services to the refineries will lose their jobs, and this will ripple and spread out to other sectors.
None of the above are by any means a good thing for South Africa, these are the immediate dangers from such sudden close down of our refineries and cannot be fixed by any advantages that might be offered by closing of refineries that will only show years after implementations. In my opinion, our first priority should be Eskom and getting more electricity generation capacity first which will probably takes years, use this time to plan the pivot away from traditional petroleum energy source, we cannot afford to pivot now while the electrical energy side still have issues. And as much as I hate being blackmailed by the oil industry, we might not have much of a choice except meeting them somewhere in the middle, the fact is that the cost of the clean fuels implementation probably does not make sense for the oil companies on such old plants, and it will make better business sense to them to close down if they are really forced into it, we as South Africa is unfortunately not really in a good position to negotiate given our current situation.
So ye, closing of refineries now = very bad news and in no way good...
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