| The Strategic Fuel Fund Association also known as “SFF” was established in 1964 as a Section 21 strategic oil reserves agency of South Africa. SFF owns three crude oil storage facilities across the country and only one is still operational, the facility in Saldanha Bay. The Saldanha Bay crude oil storage terminal capacity is 45 million barrels and is the biggest facility by capacity in the southern hemisphere. The facility is used to store government owned reserves of crude oil and any excess storage capacity is leased out to international crude oil trading entities.
The primary legislations regulating the core activities of SFF are the National Energy Act 34 of 2008 (Energy Act), Central Energy Fund Act 34 of 2008 (CEF Act), and the Petroleum Pipelines Act 60 of 2003 (NERSA Act).
The activities of SFF, in so far as they relate to the storage of strategic stocks, are regulated by s17(1) of the Energy Act. The Energy Act empowers the Minister of Mineral Resources and Energy to direct SFF to maintain strategic reserves of crude oil in accordance with the published government policy or strategies. The utilisation of proceeds that SFF receives from the sale of crude oil is regulated by s3 of the CEF Act.
The maximum tariff that SFF can charge the market for leasing the excess crude oil storage capacity in Saldanha Bay is regulated by the NERSA Act and the setting of the maximum tariff by the Authority is a condition of SFF’s license to operate the crude oil storage facility.
Over the years SFF has managed not only to generate net income for South Africa, but has also been able to finance the operating costs of maintaining the country’s strategic oil reserves at no cost to the State.
During the years that SFF has been involved in crude oil handling, hundreds of cargoes of oil have been imported or exported without pollution of the environment. And this was achieved through the organisation’s best equipped and manned oil pollution control centre in the southern hemisphere.
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