A group known as “Concerned Gas Suppliers” has issued a formal appeal to the Department of Mineral Resources and Energy (DMRE), calling for an investigation into Vita Gas, a subsidiary of global energy giant Vitol.
According to a letter seen by The Star, the group stated that they “have received damning information that Vita Gas is partaking in corrupt practices, which not only jeopardises the market for LPG supply in the Western Cape, but also severely compromises the integrity and public trust”.
The letter goes on to reveal that “the nature of this corruption involves recently engineered June gas supply crisis and disruption in the Western Cape”.
The group alleges that Vita Gas had deliberately withheld supply, impacting downstream suppliers and the public. The petitioners have thus called on the DMRE “ to launch a formal investigation on the matter to avoid any repeat which would see the consumers put under vulnerable conditions by the likes of Vitol”.
Last month, a report in The Star’s sister Newspaper, Daily News, indicated that the recent disruption in gas supply in the Western Cape was not merely the result of a contractual dispute. Reliable sources said that it was, in fact, a calculated act of corporate sabotage perpetrated by Vita Gas. The alleged intent was to weaken Sunrise Energy, the sole LPG terminal operator in Saldanha Bay, making it susceptible to a takeover by Vita Gas.
Insiders claim that Vitol instigated the crisis by terminating its contract with Sunrise Energy abruptly, thereby depleting stock levels and intentionally delaying shipments of LPG. Vitol has formally denied these allegations. The DMRE letter further accuses Vita Gas of offering “substantial monetary bribes and other forms of incentives” to disseminate false or misleading information about the LPG market in the Western Cape.
“The orchestrated disinformation campaigns are strategically aimed to create a monopoly and control the supply of LPG in Western Cape for them, effectively disrupting fair market competition,” the letter reads.
In related news, Vitol disclosed that its affiliate, Vivo Energy, is set to acquire Engen, further consolidating its presence in the South African energy sector. The acquisition is still with the competition commission.
The group’s letter emphasises that Vitol’s purported actions “flagrantly contravenes the principles of ethical business conduct and fair competition laws”. It insists that “an immediate and thorough investigation is undertaken to bring the perpetrators to justice and to prevent any further corrupt activities that may lead to an irrevocable disruption in the market of LPG,” the letter concludes.
Asked of the allegations of “substantial monetary bribes and other forms of incentives being offered and paid by Vita Gas (Vitol) to public relations agencies to report false or misleading information about LPG market in WC”, Andrea of Vita Gas responded: “This is untrue. Neither Vita Gas nor Vitol has appointed or paid a PR agency in SA in relation to the LPG business. Vitol and Vita Gas conduct their business in full compliance with the law. Any suggestion that ‘bribes’ have been paid is incorrect and defamatory.”
DMRE wasn’t available for comment at the time of going to print.