Crisis spreads to fuel and gas supplies
6 February 2008, 09:09
By Caryn Dolley, Anel Powell and Ingi Salgado
As of Wednesday Chevron Refinery will not be able to supply consumers with liquefied petroleum gas and the sales of ship fuel will be suspended as the refinery says it cannot run because of the "unavailability of stable power supply".
But Eskom says there is an electricity supply to Chevron, albeit a "risky" one.
The hospitality industry was also reeling from the news that gas shortages could add to their power shortage woes and the shipping industry was worried about gas not being available.
Last night, Chevron Refinery's public affairs manager, Phumi Nhlapo, said it had sufficient diesel and petrol stocks but could not resume production because it did not have a stable power supply.
She said the refinery began the "restarting process" on Saturday after Friday's unplanned shutdown caused by the city-wide blackout, but was "unable to move forward with the start-up due to the unavailability of stable power supply".
"Chevron has sufficient stocks of petrol and diesel. However, as this delay in the start-up has affected the refinery's ability to resume production, the refinery will be unable to supply liquefied petroleum gas as of tomorrow and sales of bunker gas oil (for ships) are currently suspended. Bitumen (used to make an adhesive under paving units) stocks are also limited. Although the refinery's jet fuel stocks are also low, contingency plans are being put in place to address this issue," Nhlapo said.
Eskom's Jolene Henn said although a damaged transmission line supplying the Acacia substation which, in turn, supplied power to the refinery, had not yet been "fully restored," Eskom was still supplying power to the refinery.
She could not say how long repairs to the line would take or what needed to be done to get the line up and running.
"We are running the second test, which will determine for how much longer the line will be down and what needs to be done (to fix it)."
Henn admitted there was a "risk because the line was not fully repaired yet", but emphasised there was no reason why Chevron should be struggling to resume production of gas.
Eskom spokesperson Andre Etzinger said one of two separate transmission lines to the Chevron refinery was out of service.
"The refinery has power but they don't want to take a chance without the back-up line," he said.
Nhlapo said there was sufficient power to start the refinery's boilers but it could not "start the production units themselves."
Chevron has informed its customers that it is unable to supply them with gas.
JSE-listed gas company Afrox is the group's major client, but oil group BP also sourced gas from the refinery. Neither Afrox nor BP could be reached for comment last night.
It was unclear whether BP would be able to source additional shipments of gas stocks from the Sapref refinery that it co-owns with Shell in Durban.
Last night, Sanjay Govan, port manager of the National Ports Authority, was shocked to hear no ship gas would be sold from Wednesday.
"It will have a negative impact on the port. First, we have a number of vessels coming to load or discharge cargo and second, we often receive special calls just for (refuelling). These ships plan their journeys and if there's no (fuel) they have to make other arrangements. I wasn't aware of this and Chevron usually passes this type of information to the harbour master," he said.
A representative of another shipping line, who asked to remain anonymous, said if Chevron was "serious" it would be "an absolute disaster".
"We've got a number of ships due for bunkering (filling up with fuel) and weren't even told about this. Chevron really can't be serious. This effectively means ships needing refuelling shouldn't come into the port. This type of gas oil is used for a ships generators. Without it ships can't run," he said.
Restaurants also cringed at the news that no liquid petroleum gas would be available.
Amigos restaurant in Kloof Street said a gas shortage would mean "huge problems" for the business as it relied on gas.
Beluga's in Green Point, which managed to keep customers fed during Friday's blackout because it has gas stoves, said it was "totally reliant" on a steady supply of the fuel.
Spur Steak Ranches said it was supplied with gas twice a week and could not operate its grills without gas.
A small gas retailer in Salt River also said last night that if the gas wholesalers were short of stock, retailers would definitely suffer. "I expect it to impact on our supplies," he said.
If the gas shortage became pronounced, households that have switched fuel sources - from gas from electricity - would also be affected.
Airports Company of SA spokesperson Deidre Hendricks could not be reached for comment last night, but on Sunday told the Cape Times it used fuel from Chevron and Shell and would be told if there was a shortage.
Meanwhile, Derrick Spies reports that economists predicted the country was heading for a fuel crisis due to dwindling reserves.
In Gauteng a number of filling stations ran dry last night due to a rush on petrol ahead of the 17-cents-per-litre increase that came into effect from midnight and experts warned the Eastern and Southern Cape could also soon experience shortages similar to those in February 2006, when the region was left without petrol for three days after stocks ran out.
Fuel Retailers Association chief executive officer Peter Morgan said it was only a matter of time before fuel shortages rocked South Africa.
"Just like with Eskom, a white paper was drawn up in 1998 highlighting the growth in fuel demand and the need to increase capacity in terms of production, as well as in terms of increasing reserve stocks of refined products, but nothing has been done," he said.
Morgan said the country needed to be building the capacity to restore refined product and it would take from nine months to a year to build the tanks. "The fuel is available, there is no problem to import it, it's just that we have nowhere to put it when it gets here."
As of Wednesday Chevron Refinery will not be able to supply consumers with liquefied petroleum gas and the sales of ship fuel will be suspended as the refinery says it cannot run because of the "unavailability of stable power supply".
But Eskom says there is an electricity supply to Chevron, albeit a "risky" one.
The hospitality industry was also reeling from the news that gas shortages could add to their power shortage woes and the shipping industry was worried about gas not being available.
Last night, Chevron Refinery's public affairs manager, Phumi Nhlapo, said it had sufficient diesel and petrol stocks but could not resume production because it did not have a stable power supply.
She said the refinery began the "restarting process" on Saturday after Friday's unplanned shutdown caused by the city-wide blackout, but was "unable to move forward with the start-up due to the unavailability of stable power supply".
"Chevron has sufficient stocks of petrol and diesel. However, as this delay in the start-up has affected the refinery's ability to resume production, the refinery will be unable to supply liquefied petroleum gas as of tomorrow and sales of bunker gas oil (for ships) are currently suspended. Bitumen (used to make an adhesive under paving units) stocks are also limited. Although the refinery's jet fuel stocks are also low, contingency plans are being put in place to address this issue," Nhlapo said.
Eskom's Jolene Henn said although a damaged transmission line supplying the Acacia substation which, in turn, supplied power to the refinery, had not yet been "fully restored," Eskom was still supplying power to the refinery.
She could not say how long repairs to the line would take or what needed to be done to get the line up and running.
"We are running the second test, which will determine for how much longer the line will be down and what needs to be done (to fix it)."
Henn admitted there was a "risk because the line was not fully repaired yet", but emphasised there was no reason why Chevron should be struggling to resume production of gas.
Eskom spokesperson Andre Etzinger said one of two separate transmission lines to the Chevron refinery was out of service.
"The refinery has power but they don't want to take a chance without the back-up line," he said.
Nhlapo said there was sufficient power to start the refinery's boilers but it could not "start the production units themselves."
Chevron has informed its customers that it is unable to supply them with gas.
JSE-listed gas company Afrox is the group's major client, but oil group BP also sourced gas from the refinery. Neither Afrox nor BP could be reached for comment last night.
It was unclear whether BP would be able to source additional shipments of gas stocks from the Sapref refinery that it co-owns with Shell in Durban.
Last night, Sanjay Govan, port manager of the National Ports Authority, was shocked to hear no ship gas would be sold from Wednesday.
"It will have a negative impact on the port. First, we have a number of vessels coming to load or discharge cargo and second, we often receive special calls just for (refuelling). These ships plan their journeys and if there's no (fuel) they have to make other arrangements. I wasn't aware of this and Chevron usually passes this type of information to the harbour master," he said.
A representative of another shipping line, who asked to remain anonymous, said if Chevron was "serious" it would be "an absolute disaster".
"We've got a number of ships due for bunkering (filling up with fuel) and weren't even told about this. Chevron really can't be serious. This effectively means ships needing refuelling shouldn't come into the port. This type of gas oil is used for a ships generators. Without it ships can't run," he said.
Restaurants also cringed at the news that no liquid petroleum gas would be available.
Amigos restaurant in Kloof Street said a gas shortage would mean "huge problems" for the business as it relied on gas.
Beluga's in Green Point, which managed to keep customers fed during Friday's blackout because it has gas stoves, said it was "totally reliant" on a steady supply of the fuel.
Spur Steak Ranches said it was supplied with gas twice a week and could not operate its grills without gas.
A small gas retailer in Salt River also said last night that if the gas wholesalers were short of stock, retailers would definitely suffer. "I expect it to impact on our supplies," he said.
If the gas shortage became pronounced, households that have switched fuel sources - from gas from electricity - would also be affected.
Airports Company of SA spokesperson Deidre Hendricks could not be reached for comment last night, but on Sunday told the Cape Times it used fuel from Chevron and Shell and would be told if there was a shortage.
Meanwhile, Derrick Spies reports that economists predicted the country was heading for a fuel crisis due to dwindling reserves.
In Gauteng a number of filling stations ran dry last night due to a rush on petrol ahead of the 17-cents-per-litre increase that came into effect from midnight and experts warned the Eastern and Southern Cape could also soon experience shortages similar to those in February 2006, when the region was left without petrol for three days after stocks ran out.
Fuel Retailers Association chief executive officer Peter Morgan said it was only a matter of time before fuel shortages rocked South Africa.
"Just like with Eskom, a white paper was drawn up in 1998 highlighting the growth in fuel demand and the need to increase capacity in terms of production, as well as in terms of increasing reserve stocks of refined products, but nothing has been done," he said.
Morgan said the country needed to be building the capacity to restore refined product and it would take from nine months to a year to build the tanks. "The fuel is available, there is no problem to import it, it's just that we have nowhere to put it when it gets here."
- This article was originally published on page 1 of The Cape Times on February 06, 2008
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