Energy

Three companies taking over South Africa’s petrol stations

Commodity trading giants such as Glencore, Vitol, and Trafigura are significantly expanding their presence in South Africa through petrol station forecourts and, in limited cases, refineries. 

These companies own some of the country’s best-known petrol station brands, including Astron Energy/Caltex, Engen, and Puma Energy. These brands are seen on nearly 2,000 petrol station forecourts across South Africa. 

The expansion of commodity traders into retail has long been part of their strategy to vertically integrate their businesses and get direct access to the consumer. 

Having control of petrol stations and refineries also gives them channels through which they can sell the oil they have traded, as these companies do not have the established distribution channels of Shell or BP. 

The expansion of commodity traders into fuel retail in South Africa has only really happened in the last decade, with Puma Energy snapping up Brent Oil and Drakensberg Oil in 2015 to expand into the country. 

However, since then, these companies have poured billions into rapidly growing in South Africa and expanding into Africa. 

South Africa has long been attractive to these companies due to its rich mineral resources and developed logistics network. 

However, more recently, it has been seen as the gateway into Africa for these companies and an important market for their commodities with the continent’s growing appetite for oil and other resources. 

By expanding their petrol station forecourts, these companies have also become a recognisable feature of South Africa for the first time. 

Typically, their investments were in mines, smelters, and refineries. Their foray into fuel retail has put them into contact with most of the population. 

Below is the story of how these companies have come to play such a major role in South Africa’s fuel distribution network and expansion of their petrol station brands. 


Puma Energy

Puma Energy, owned by French multinational Trafigura, was the first commodities trader to dip their toe into South African petrol stations. 

With its purchase of Brent Oil and Drakensberg Oil in 2015, the company became a major player in fuel retail and the distribution of lubricants in South Africa. 

Trafigura specialises in trading oil and metals worldwide and is one of the few commodity trading companies to have built physical infrastructure, including mines, pipelines, storage facilities, and terminals. 

Founded in 1993, Trafigura currently ranks as the world’s largest private metals trader and second-largest oil trader. 

Puma Energy was created as a subsidiary to support its trading business by controlling a share of the world’s oil supply, storage, and logistics network. 

The company began expanding into petrol stations in the early 2010s, with its subsidiary Puma Energy expanding into the Australian market. 

In 2013, it snapped up 250 petrol stations in Australia alongside two oil import terminals and five fuel depots as it looked to benefit from rising demand in the country and the closure of outdated refineries. 

After buying its way into the South African market, Puma Energy began opening retail petrol stations in the country. 

While relatively small compared to its peers, Puma Energy operates around 118 retail sites across South Africa and wholly owns 97 convenience stores. It also has a huge 1,200m³ worth of storage in the country. 

In recent years, it has also partnered with American convenience store brand Circle K to bring its products to South Africa. 


Astron Energy

Backed by Glencore, Astron Energy has invested billions in revamping its petrol station network in South Africa and is looking to take on traditional giants such as BP and TotalEnergies. 

Since buying American giant Chevron’s Southern African assets in 2017, Glencore has looked to unify its African assets under one umbrella. 

Founded in 1911 as Texaco in South Africa, Astron Energy has operated in South Africa for over 100 years in various guises. The retail business, Caltex, was launched in 1936 as a partnership between American giants Chevron and Texaco. 

The company launched its refinery in Milnerton in 1966, with numerous upgrades being implemented since then. 

In 2017, Glencore bought all of Chevron’s South African assets for $1 billion and set about rebranding its petrol station forecourts and the refinery to consolidate its brands under a single identity. 

Since then, the Swiss company has pumped money into South Africa to upgrade and maintain the refinery while expanding its petrol station network. 

Much of the attention has been focused on the rebranding of the 850 Caltex petrol stations around South Africa, with Astron seemingly painting the country orange. 

This rebranding project has been underway since 2022, with over 300 stations being rebranded so far. On average, 20 sites are rebranded to Astron every month.

However, despite receiving much less attention, most of Astron’s revenue in South Africa comes from its refinery in Cape Town. 

The refinery is the third-largest in South Africa and is estimated to generate R95 billion in value for the local economy and supports 56,917 jobs directly and indirectly. 

The refinery is able to produce 100,000 barrels of refined petroleum every day and is one of two able to produce jet fuel locally. 

Glencore CEO Gary Nagle said following the commodity giant’s most recent financial results that the refinery is cash-generative for the company and is pleased with its operations. 


Engen

Oil trading giant Vitol was much later to the party than its counterparts, with its most significant expansion into South Africa coming with its purchase of Engen in early 2023. 

This transaction was completed through its subsidiary, Vivo Energy, which bought a 74% stake in Engen from Malaysian giant Petronas. 

Although late to the party, Vitol snapped up South Africa’s largest fuel-distribution network, with around 1,000 forecourts across the country. 

Engen markets approximately 500 petrochemical products, many of which are manufactured in its two manufacturing plants in Durban. 

When combined with Vivo’s African assets, over 3,900 service stations and two billion litres of storage will be united under a single brand. 

This gives the world’s largest independent energy trader significant assets in Africa, through which it can distribute the 350 million tonnes of crude oil it ships around the world annually. 

On average, the company handles around 7.3 billion barrels of oil a day. The company is also completely privately owned by around 400 partners who are current and former employers. 

It is reported that the company pays out around $2.9 billion a year to its partners – a huge sum to maintain the company’s intense culture of privacy and secrecy. 

The company’s expansion into South Africa did come at a cost, with the government imposing strict conditions on Vivo Energy’s purchase of Engen. 

These included a R10 billion commitment to new investments, which could rise to R14 billion and a pledge to purchase R100 billion worth of oil from local refineries. 

This should benefit Astron and Sasol, who operate the three refineries from which the company could purchase its finished oil products refined in South Africa. 


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