The cost of fuel in South Africa comes down to affordability. This was the word from the South African government on the sidelines of African Oil Week, taking place in Cape Town this week.
Addressing a press briefing at the event, Minister of Mineral Resources and Energy, Gwede Mantashe, said everyone was struggling with the high cost of fuel in the country at the moment, but that ultimately it was all about affordability.
Using an example of how he had to wait to make clothing purchases as a child until he could afford them due to the extreme poverty he grew up in, Mantashe said it was similar to being able to afford a car.
He said being able to afford a car by its very nature implied one was able to afford the fuel it required to run the vehicle.
He acknowledged that the closing of refineries in the country had been to the detriment of consumers and that the import of fuel was unsustainable in the long run.
During his keynote address at the conference, Mantashe highlighted the importance of global refining capacity and how it not only could reduce the cost of fuel, but also increase intra-African trade.
“The reopening of refineries that refine West African crude will boost the security of supply in the region. An important point to make is that growing the content requires us to grow intra-African trade, particularly oil and gas.”
Mantashe also welcomed the increased demand for coal saying exports out of South Africa had seen a 27% increase this year.
“We have seen an increase in demand for coal from the European Union and volumes have been good. We saw an overall growth in coal exports and the coal prices are good,” he told delegates.
“On the other hand, however, we are being told that developing countries in Africa need to get out of the coal business. This is a contradiction.”
According to Mantashe, the increased export of coal was not a sign of non-committal to the energy transition.
“We are moving from high to low carbon emissions on the continent. This, however, needs to be dictated by our developmental needs and not by any countries who are already at a developed level.”
He said South Africa was committed to the global agenda to decarbonise.
“We continue to emphasise this because we are not a rebel when we continue to look at fossil fuels as well. We are not against decarbonisation. All we are saying is that transition must consider the continent’s development needs. We are the most disadvantaged continent and we can change that trajectory.”
Mantashe emphasised that this would require a strategic approach requiring more collaboration between governments and governments and the private sector.
“Any transition to low carbon emissions must include energy security as well as economic growth and development for Africa.”
