South Africa Probes Bid for Chevron Assets by State Fuel Fund

  • Nation’s Strategic Fuel Fund didn’t request consent over deal
  • Chevron assets in region said to fetch about $1 billion

South Africa’s Department of Energy said it will investigate a bid by one of its own entities for Chevron Corp.’s assets in the country.

The Strategic Fuel Fund, part of the Central Energy Fund Group that reports to the government department, said on Wednesday that it made an offer for Chevron’s Cape Town oil refinery, retail fuel stations and other assets. The sale may fetch about $1 billion, people familiar with the matter said in March.

"An offer to purchase by an entity of the Department of Energy requires express consent from the Minister of Energy as the ultimate shareholder representative,” the Energy Department said Thursday in an e-mailed statement. “This was neither sought nor obtained."

The energy minister will investigate that bid, with her department “disturbed at the complete disregard” for governance processes. South Africa’s opposition Democratic Alliance said it plans to ask the National Treasury to block a potential deal involving the Strategic Fuel Fund as the money could be better spent on boosting economic growth.

Chevron’s South African business includes the 110,000 barrels-a-day refinery in Cape Town and a lubricant plant in the eastern port city of Durban. The company also markets its Caltex-branded products through more than 845 filling stations, according to its website.

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