Three international giants taking over petrol stations across South Africa
Three of South Africa’s largest petrol station brands are owned by international commodity trading giants as they look to break into the continent.
Glencore, Vitol, and Trafigura are behind some of the country’s most popular petrol stations, including Astron Energy/Caltex, Engen, and Puma Energy.
Together, these brands own over 2,000 petrol stations across South Africa, with Glencore also owning Astron Energy’s refinery in Cape Town that is capable of producing 100,000 barrels of refined petroleum per day.
The companies have pumped billions into South Africa to enter the market and rapidly grow their presence, with others looking to follow suit.
Gunvor is in talks to acquire Shell’s downstream assets in South Africa, which areestimated to be worth around R17 billion.
These trading giants are some of the most lucrative companies in the world, often operating in the shadows and at immense benefit to their shareholders.
Although unusual, these companies have begun buying up physical assets over the past two decades, including mines, refineries, and now petrol stations.
It is all part of their strategy of being able to effectively control large parts of the supply chain along which they can trade commodities or move them to different destinations.
These companies are also looking to unify their brands across Africa, using South Africa as a gateway to the continent as its most industrialised economy.
Glencore, a trading powerhouse, is now seen as largely a mining company, with mines spanning copper and coal, alongside smelters and refineries.
It has a substantial South African connection through former CEO Ivan Glassenberg, who made the company what it is today and made himself billions of dollars in the process.
Now run by Gary Nagle, another South African accountant, the company remains committed to the country and has flagged vast improvements in operating conditions.
The other two commodity-trading giants are relatively late to the party in terms of owning physical assets in South Africa, although they have long traded the country’s commodities on international financial markets.
Trafigura snapped up Brent Oil and Drakensberg Oil in 2015 through its subsidiary, Puma Energy, to make inroads into the South African market.
Engen was acquired by Vitol, through its subsidiary Vivo, in a transaction that took over a year to conclude, with it only taking ownership of the assets in 2024.
With Shell’s downstream assets, including petrol stations, up for sale in South Africa, another commodity trader may enter the market.
Swiss-based Gunvor has expressed interest in buying Shell’s assets in the country, with it competing against Abu Dhabi National Oil Company (Adnoc) in the bidding process.
Trafigura’s Puma Energy has also expressed an interest in the assets, which would significantly expand its retail presence in the country.
Vitol’s Engen
Engen has a storied history in South Africa, with it operating in the country for over 140 years to dominate downstream refined products in the country.
Founded in response to the growing demand for oil and fuel products in South Africa at the end of the 19th century, Engen now operates over 1,000 petrol stations in the country.
Born as the Natal Oil Company, it initially focused on producing kerosene and other petroleum products. South Africa’s rapid industrialisation and urbanisation would see it shift towards commercial petrol and other refined fuels.
Despite this long history in South Africa, Engen only began building out its petrol station network in the 1960s when fuel demand surged alongside increased vehicle ownership.
This was largely driven by the significant expansion of South Africa’s national road network and strong economic growth following WWII.
Engen established its refinery in Durban in 1971, branching out into the production of diesel and aviation fuel. The company also began to export some of its products.
The 2000s would bring significant changes for Engen, with Black Economic Empowerment firm Phembani acquiring a 20% stake in the company.
South Africa’s improved ties with the rest of Africa also saw Engen expand into Africa, buying facilities in the Democratic Republic of Congo, Gabon, Rwanda, and Burundi in the late 2000s.
This expansion brought it to the attention of global giants looking to expand their presence in Africa, with Vitol finally coming to the party in early 2023.
Its subsidiary, Vivo Energy, bought a 74% stake in Engen from Malaysian giant Petronas, creating a continental player with over 3,900 petrol stations across Africa.
Unified with Vivo’s African operations, Engen now has over two billion litres of storage space across the continent through which it can supply petroleum products.
This is crucial for Vitol, which, as the world’s largest independent energy trader, has substantial African assets through which it can distribute the 350 million tonnes of crude oil it ships around the world every year.
Vitol is a highly secretive company, owned by around 400 partners who are current or former employees. It is reported that the company pays out around $2.9 billion a year to these partners.
Glencore’s Astron Energy
Astron Energy is another petroleum company with over 100 years of consistent operation in South Africa, riding the country’s industrialisation to build a global behemoth.
Founded in 1911, the company is South Africa’s second-largest fuel retailer, with over 850 stations across the country under the Caltex and Astron Energy brands.
Originally called the Texaco Company, the company floundered as it imported raw crude for transport across South Africa.
It unveiled its Caltex brand in 1936, created as a byproduct of the formation of Chevron South Africa, which was a joint venture between Texaco and Standard Oil.
As with Engen, Caltex benefited from South Africa’s strong economic growth and increased vehicle ownership to begin selling fuel directly to consumers.
It opened its refinery in Cape Town in 1966, which is one of the few refineries still operating in South Africa, producing around 100,000 barrels of refined petroleum products per day.
Apart from its lubricant manufacturing plant in Durban, Caltex grew its petrol station forecourt business strongly throughout the 2000s.
In 2017, Glencore came knocking and snapped up Chevron’s South African assets for $1 billion, investing heavily to upgrade the company’s infrastructure.
This included a new petrol station design, converting all existing Caltex stations into Astron Energy-branded forecourts. Through this, Glencore unified its African brands under Astron Energy.
The rebranding project has been underway since 2022, with over 500 stations being rebranded so far. The company says it rebrands around 20 sites per month.
While the company’s petrol station forecourts get much of the attention, much of the revenue generated by the business comes from its refinery in Cape Town.
As the third-largest refinery in the country, it is estimated to generate R95 billion in revenue for the local economy and supports over 50,000 jobs.
Glencore CEO Nagle told investors that the refinery is cash-generative for the company and is pleased with its operations, with the commodity trader remaining committed to South Africa.
Trafigura’s Puma Energy
Puma Energy has built its presence in South Africa through acquisitions, with it being the first subsidiary of a commodity-trading giant to set foot in the country.
Founded in Argentina, Puma Energy is now owned by Singapore-based Trafigura, which is one of the largest oil trading companies in the world.
Its physical presence remains relatively small despite its global reach, with only 1,900 petrol stations and 7.9 million cubic metres of storage across the forty countries it operates in.
Puma Energy first expanded to Africa through the Congo in 2002, before rapidly expanding across West Africa and into Southern Africa.
This makes it one of the few cases of a multinational expanding into South Africa as the endpoint of its growth rather than the beginning.
South Africa has historically been seen as the gateway into Africa due to its highly industrialised economy and deep capital markets.
Puma Energy only entered South Africa in 2015, with the acquisition of Brent Oil and Drakensberg Oil giving it a foothold in the country.
The purchase of these companies gave it extensive downstream assets and a strong lubricants business. It, however, left it short in terms of petrol stations.
Puma Energy currently operates only 145 petrol stations in South Africa, giving it a far smaller presence than its competitors.
However, it does have an edge through Trafigura’s extensive experience in building physical infrastructure for the transport and sale of petroleum products.
While it specialises in trading oil and metals across the world, it has built mines, pipelines, storage facilities, and terminals around the world.
Through Puma Energy, Trafigura does have plans to rapidly expand its petrol stations across South Africa, with it eyeing Shell’s downstream assets.
The firm is supposedly on the short list to purchase Shell’s significant petrol station network and downstream assets in South Africa, as the petroleum giant shrinks its global footprint.
If Puma Energy manages to buy Shell’s assets, it would have one of the largest petrol station networks in South Africa, significant storage facilities, and access to depots.
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