Jet Fuel Crisis Warning

The Fuels Industry Association of South Africa has warned of a potential jet fuel supply shortage that could disrupt operations at OR Tambo, King Shaka and other airports.

The association said in an October 10 press release that the supply of aviation kerosene was facing a severe threat due to regulatory delays in the licensing of import storage facilities by Sars.

The issue comes after the closure of the Engen and Sapref refineries in KwaZulu-Natal, when, during 2023, Sars insisted that affected parties license their facilities in accordance with the Customs and Excise Act.

The Act requires the import of aviation kerosene into dedicated storage facilities to be subject to stringent licensing conditions.

In the interim, Sars granted temporary, time-bound licensing for the importation of aviation kerosene. The affected parties set about applying for the permanent licensing of their facilities, which was completed in February of this year. Another time-bound licensing arrangement had to be provided, which is set to expire later in October.

However, more than six months later, Sars has yet to finalise the permanent licensing of these facilities, despite previously indicating that the process could be completed in a much shorter time frame.

Local companies cannot be expected to import without regulatory approval, and the regulatory uncertainty places the planning and the economic supply of aviation kerosene under pressure. This also has ramifications for the airline industry, which will take steps to avoid potential stockouts by cancelling scheduled flights and causing serious doubt about the local reliability of airline traffic due to the unreliability of aviation kerosene supply, the press statement said.

To avert a supply crisis, the association has urgently called on the minister of finance to instruct Sars to extend temporary licences for at least 12 months or until the necessary permanent licensing is finalised.

In April this year, Acsa warned of dangerously low fuel stock levels at OR Tambo, which had dipped below the acceptable five-day benchmark, reported by Travel News .

At the time, the issue did not relate to this licensing issue with Sars.

The AirlinesAssociation of Southern Africa has confirmed to Travel News that there is not currently a supply shortage of jet fuel but that this impasse with Sars could create one.

Source Travel News