BP’s R5bn investment and a BEE promise

Petroleum giant BP has promised to facilitate various black economic empowerment (BEE) opportunities across its value chain in the roll out of a R5bn South African investment plan announced yesterday.

This may come to address concerns that petroleum giants have not done enough to support BEE within their core value chains as expressed by key stakeholders. A study of empowerment in the industry commissioned by the department of energy supported the misgivings towards the end of last year. This pushed the department of energy to issue harsh exhortations.

BP’s Group MD Iain Conn unveiled the plan yesterday which is part of a massive R5bn investment in South Africa and Mozambique.

The R4.2bn allocated to South Africa includes plans to expand BP’s footprint which is where the BEE opportunities transpired. BP plans to expand its retail network in what will lead to a roll out of new service stations in the hundreds across the country. Conn said the company will emphasise BEE in this roll out and in particular women empowerment.

He said BP’s retail network will benefit from the announced investment which will improve customer experience. The conversion to a “best in class” convenience retail offering, in partnership with Pick n Pay, will see 120 Pick n Pay Express stores opened in the next five years across South Africa. Coupled with improvements to the BP Express convenience offering, the fuel forecourts will be upgraded with a standardised look.

He added that the investment plan will be spread across various projects across the BP Fuels Value Chain including refinery, terminal and retail network assets. “This is a sign of BP’s growing confidence in the South African economy as an attractive investment destination especially after the adoption of the National Development Plan (NDP) as the road map for the country”.

Conn emphasised that BP’s commitment is not only about the capital and commercial investment. “It is also about being part of a South African community and continuing to contribute to the improvement of people’s lives through a focused transformation programme aligned with Government’s goal to create jobs, develop skills and build entrepreneurs, as well as achieve sustainable economic growth”.

He said BP has been at the forefront of transformation over a number of years citing the 2001 initiative which saw BP become one of the early movers into the BEE space. He said BP’s empowerment has resulted in cash pay-outs to BEE shareholders to the tune of R300 million.

“Subsequently, Masana, a joint venture between BP and its BEE partners, was formed in 2005. This has been one of South Africa’s empowerment success stories which has doubled its growth since inception,” said Conn.

“BP continues on pioneering the transformation journey with the latest hydrocarbon (crude oil) procurement initiative which invited and encouraged local previously disadvantaged enterprises to participate in a tender process”.

Leave a Reply

Your email address will not be published. Required fields are marked *