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PRESENTATION TO THE PORTFOLIO COMMITTEE ON MINERALS AND ENERGY 14 SEPTEMBER 2005

PRESENTATION TO THE PORTFOLIO COMMITTEE ON MINERALS AND ENERGY 14 SEPTEMBER 2005. CEF GROUP STRUCTURE. CEF (Pty) Ltd incorp. EDC Chairperson - A Mjekula CEO - M Damane. Central Energy Fund. 100% SFF ASSOCIATION Chairperson – A Mjekula CEO – M Damane. 100% PETROSA

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PRESENTATION TO THE PORTFOLIO COMMITTEE ON MINERALS AND ENERGY 14 SEPTEMBER 2005

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  1. PRESENTATION TO THE PORTFOLIO COMMITTEE ON MINERALS AND ENERGY14 SEPTEMBER 2005

  2. CEF GROUP STRUCTURE CEF (Pty) Ltd incorp. EDC Chairperson - A Mjekula CEO - M Damane Central Energy Fund 100% SFF ASSOCIATION Chairperson – A Mjekula CEO – M Damane 100% PETROSA Chairperson – P Molefe CEO – S Mkhize 100% Petroleum Agency SA Chairperson – J Rocha Acting CEO – M Xiphu 100% iGAS Chairperson – Z Rustomjee COO – M de Pontes 100% OPCSA Chairperson – A Mjekula CEO – P Coetzee 100% SANERI 49% Bannietor Mining 30% Süd-Chemie Zeolites

  3. CEF GROUP RESULTS 2004/5 (R’m)

  4. CEF GROUP – 2004/5 RESULTS (contd) CEF • Lower interest rates and reduced cash reserves significantly impacted on revenue • Significant progress made within EDC division • Very good funding obtained for iGas Rompco investment • Fixed portion of foreign loan repaid • No dividends paid due to large Capex requirements and poor 2003/4 results

  5. CEF GROUP – 2004/5 RESULTS (contd) PASA • 18 June 2004 – designated agency i.t.o MPRDA • Tax exemption from 18 June 2004 • Significant increased revenue as a result of increased revenues from PetroSA • Significant roles played: - WPC - Continental Shelf Claim Project - UTT

  6. CEF GROUP – 2004/5 RESULTS (contd) OPCSA • Market survey completed - OPCSA is by far the largest and most technically advanced player in oil pollution in South Africa • Loan of R32.4 million from SFF was written off and has significantly improved the balance sheet • Assisted with salvage of BBC China

  7. CEF GROUP – 2004/5 RESULTS (contd) IGAS • Approval for investment in 25% of Rompco. Deal was effective from 1 July 2005 • Equity portion of deal was funded at 50% debt : 50% equity from CEF cash reserves. Guarantees have been provided for debt within Rompco • Rapidly progressed studies for LNG facility in Eastern Cape

  8. CEF GROUP – 2004/5 RESULTS (contd) SFF • Sale of Killarney storage facility to Caltex for R37.6 million profit • Strategic stocks below requirement. Insufficient cash to procure 1 VLCC • Backwardation deal to monetise strategic stocks • New ministerial directive making trading of crude oil stock impossible • Need to find ways to fund crude oil storage • Application i.t.o MPRDA to enable monetisation of mineral rights

  9. CEF GROUP – 2004/5 RESULTS (contd) ENERKOM • Patents sold for 1,5 m • Company to be liquidated in 2005/6 financial year

  10. CEF - THE FUTURE Short-term (12 months) • Begin construction of Darling Wind Farm (5.2MW) • Begin construction of Bethlehem Hydro (3.9MW) • Complete due diligence on Biodiesel (113mlpa) • Complete pilot testing for Low Smoke Fuel production • Implement pilot stage of SWH500 • Complete research on Gelfuel (as a replacement for IP) • Convene (RE) roundtable

  11. CEF - THE FUTURE (contd) Medium-term (1 - 3 years) • Operationalise Low Smoke Fuel program • Invest in at least one Landfill Gas venture • Implement financial mechanism for SWH • Implement Ethanol production plans • Complete due diligence study on Wave Power • Invest in LPG for domestic use

  12. CEF - THE FUTURE (contd) Long-term (3 - 5 years) • Distribute LSF briquettes as replacement for grade “D” coal • Monitor lignocellulose developments • Invest in Phase 2 of Darling Wind Farm • Increase penetration of SWH (take equity)

  13. iGAS – THE FUTURE Short-term (12 months) Develop the Liquefied Natural Gas to Power project in the Eastern Cape Examine possible projects to increase the gas flow from Mozambique

  14. iGAS – THE FUTURE (contd) Medium-term (1 – 4 years) • Take Final Investment decision for Liquefied Natural Gas (LNG) to Power Plant in the Eastern Cape • Manage together with Joint Venture Partners the LNG Plant construction, commissioning and operation • Implement and invest in a project for future gas throughput in the Mozambique to South Africa pipeline

  15. iGAS – THE FUTURE (contd) Long-term (> than 4 years) • Examine further increases in gas throughput in the Mozambique to South Africa Gas pipeline • Feasibilty studies for Coal Bed Methane Projects • Pre-feasibilty studies for future gas from the South African west coast, if and when such projects arise

  16. OPCSA – THE FUTURE OPCSA is already providing a pollution control service in Saldanha to: • PetroSA & Caltex • Develop these relationships and market this service to other members of the Oil Industry so that it can be rendered in other ports as well Pursue the opportunities that were identified during the oil pollution market survey • Render a pollution control service to other Government Departments

  17. SFF - THE FUTURE SFF • Need to find ways to cover costs of storage • Approach Minister re change to required strategic stock levels • Ensure funding of environmental liabilities

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