(Bloomberg) -- BP Southern Africa (Pty) Ltd. and Shell Downstream South Africa (Pty) Ltd. have reached an agreement to sell their respective 50% stakes in assets held by the nation’s largest refinery to state-owned Central Energy Fund SOC Ltd. 

The sale includes the oil companies’ interests in the land at SAPREF (Pty) Ltd. and other assets including crude and finished product tanks, process units, pipelines to and from the refinery to Island View terminal and the Single Buoy Mooring for crude imports, according to an emailed statement. 

About 48 employees who work at the refinery site and 16 trainees will transfer with the business. The sale excludes SAPREF, bpSA’s marketing businesses, the Island View terminal operations and the lubricants blending and grease manufacturer Blendcor (Pty) Ltd., it said. The sale will be subject to regulatory approvals.

“We view this agreement as a positive outcome for bpSA, for South Africa’s fuel industry and for the country as a whole,” BP Southern Africa Chief Executive Officer Taelo Mojapelo said. “Continued ownership does not fit with BP’s global strategy. Finding a buyer committed to the future of the refinery was an important consideration for us.” 

Located in Durban, SAPREF was commissioned in 1963 as a 50:50 joint venture between bpSA and SDSA. At its peak, the refinery carried a 180,000 barrels per day capacity. It currently manages the Single Buoy Mooring on behalf of the oil companies that own it. Since pausing refinery operations in 2022, SAPREF has continued to service the two companies’ market fuels requirements via imported fuels.

“Acquisition of these assets will form the hallmark of CEF’s investment and growth strategy in the energy value chain geared to lay a solid foundation to address the challenges that lie ahead in the security of South Africa’s energy future,” Mineral Resources and Energy Minister Gwede Mantashe said in a separate statement. 

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