Tepco’s chief executive Shepherd Shonhiwa on Monday assured employees at the black empowerment oil company that there was “nothing to worry about” despite the company’s impending legal dispute with Sasol.
Shepherd Shonhiwa, Tepco’s chief executive, on Monday circulated an internal memo addressed to all Tepco’s employees in which he tried to explain what was happening at the embattled black empowerment oil company.
Tepco and Sasol are involved in a legal dispute over R75 million which, Sasol said, Tepco owed for petroleum products sold to the empowerment company.
Shonhiwa said employees had “no reason to be alarmed” and said the problem arose from “underlifts” by which “Sasol forces us to take more fuel than we need”.
“We cannot always sell at a favourable price. Sasol expects to be paid on the 15th of every month,” Shonhiwa explained, “but it takes us 45 days to collect payment.”
Added to the issue of cashflow was the problem of high debtors from October, he said. Shonhiwa said Tepco had unsuccessfully appealed to the oil industry to take its surplus uplifts. Tepco stopped payments in May and resumed in July. The company had paid R20 million to Sasol and the outstanding amount now stood at less than R63 million, he added.
“We gave Sasol a payment plan for the next six months, which they indicated they would accept. Our lawyers are defending our position in court.
“We do not owe Shell anything and the amount of just over R10 million owed to Total is due to the industry accommodation account, which we are clearing. Be assured that Tepco is safe and will continue to grow in the future,” he added.