Swazi oil deal will boost SA logistics industry

MBABANE – Equatorial Guinea president Teodoro Obiang Nguema Mbasogo was in Swaziland last week to ink a deal with King Mswati to provide his country’s crude oil to the kingdom for domestic use. However, due to the absence of an oil refinery in Swaziland, the product will not arrive in its crude form but only in its refined state. Refining must be done in SA, and will be transported to and through SA before making its way to Swaziland. One source told FTW the crude would probably be shipped to Cape Town or Durban and refined at one of those locations before tanker trucks continued the trip by road to Swaziland via either the Oshoek Border or Lavumisa Border post. While the deal will boost Swaziland’s fuel supply security, whether it will lower petrol prices in the kingdom remains to be seen. Thembinkosi Mamba, the principal secretary for the Ministry of Natural Resources and Energy, told the Swazi press: “There are costs involved in the acquisition of the oil, like the cost of transporting it to South Africa where it will be refined, and the charges that we will have to pay for refining it in that country.” Historically, Swaziland’s petrol prices have tracked lower than SA because of government subsidies. Because of a government financial crisis that has seen Swaziland seek a R2.4 billion loan from SA, subsidies have been scaled back and petrol prices are now higher in the kingdom.