- Iran and South Africa officials stressed the need to expand bilateral cooperation and interaction in the energy field.
- Iran’s energy minister pointed to the country’s high capabilities and potential in the field of energy and said it is ready to share its technical and specialised capacities.
Iran and South Africa officials stressed the need to expand bilateral cooperation and interaction in the energy field.
Iranian Energy Minister Abbas Aliabadi and South Africa’s Minister of Mineral Resources and Energy Gwede Mantashe held talks on the sidelines of a meeting of the energy ministers of the BRICS member states in Moscow to discuss bilateral ties and issues of mutual interest.
The two sides exchanged views on strengthening bilateral energy cooperation. Iran’s energy minister pointed to Iran’s high capabilities and potential in the field of energy and said the country is ready to share its technical and specialised capacities with the member states of the BRICS group of emerging economies, including South Africa.
In this meeting, which was also attended by the Iranian Ambassador to Moscow, Kazem Jalali, the South African energy minister, emphasized the importance of using the technical know-how and speciality of Iranian engineers in the South African electricity industry.
The two sides also discussed cooperation in smarting the electricity production and consumption chain, the exchange of experiences in using renewable and sustainable energy, including solar and wind energy production, and the use of new technologies.
The Iranian minister of energy, who travelled to Moscow to participate in the meeting of energy ministers of the BRICS group, expressed the Islamic Republic of Iran’s proposals and views for developing cooperation within this group’s framework.
Before now, South Africa enjoyed good economic and political relationships with Iran in the era of the Shah. However, the new Iranian regime after the Islamic Revolution cut the relationship with the Apartheid South African regime after 1979 and supported its rival movement.
On the surface, South Africa and Iran suspended mutual cooperation during the Apartheid era. However, the official story concealed the fact that the Islamic regime in Tehran has owned a share in the oil refinery “Mawroutha” since the Shah era. This means that Iran was legally obliged to sell oil to South Africa for the refinery.
In January 1984, Iran announced the end of trade and economic sanctions against the country, and diplomatic relations were re-established in May 1994.
As the Apartheid regime in South Africa was skilful in producing advanced military technology, and the Iranian regime needed weapons during the Iraqi-Iranian War, the two states agreed in 1985 to exchange arms (South Africa to Iran) in return for oil (Iran to South Africa). They signed a deal worth $750 million in 1995. By the collapse of the Apartheid regime, South Africa was importing 65-90 per cent of its oil needs from Iran.
Nevertheless, in 2012, US and EU sanctions against the Central Bank of Iran forced South Africa to find an alternative source for Iranian oil, representing 27 per cent of its imports.
Thus, South Africa turned to the KSA for oil supplies and continued searching for alternative suppliers in Africa. In 2013, 60 percent of South Africa’s oil came from the KSA and Iran, while 40 percent were from African sources.
In addition to oil, Sasol (South Africa’s giant energy and chemical company) owns 50 per cent of Aria Sasol, a joint project with the National Iranian Petrochemical Company located in Pars Special Economic Zone for Energy in Bushehr. The project’s value is about $900 million.
This matter is related to one of the most important deals between the two countries, which is related to building the Sasolburg Oil Refinery and selling oil in the long run. The refinery was built 40 kilometres away from Johannesburg in cooperation with the French company “Total” and the South African “Sasol” with a daily energy production of 50000 barrels.
The shares of the project’s cooperative partners were determined as follows: 52.5 per cent for Sasol, 30 per cent for “Total,” and 17.5 per cent for the National Iranian Oil Company. Also, in 2015, South Africa signed a framework of cooperation with Iran regarding crude oil, LNG, LPG, gas, and petrochemicals.