Transnet Calls for End to Total’s South African Oil-Tariff Break

(Bloomberg) -- South African ports and pipeline operator Transnet SOC Ltd. will recover tariffs from consumers through higher fuel prices if the regulator fails to enforce pipeline tolls it says are due from the Natref refinery.

The state-owned company lodged a formal complaint with the National Energy Regulator of South Africa to investigate the failure by Natref to abide by its tariffs, Transnet said in a statement on Wednesday. The refinery is owned by Sasol Ltd. and Total SE.

The government struck a deal with Total in 1967 to allow Natref to avoid oil-transportation costs as an incentive to build the plant at an inland location, Transnet said. While the facility south of Johannesburg had been paying the related tariffs, Total and Sasol subsequently sought discounts through court claims.

“Transnet is of the view that if these tariffs cannot be recovered from Natref, they will have to be recovered from customers, resulting in all tariffs other than crude tariffs increasing by at least 10%,” Transnet said.

Sasol wasn't immediately available to respond to an email seeking comment.

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