Transnet SOC Limited has expressed disappointment with the High Court ruling. The judgment was handed down on June 18, 2024. The case involved Total Energies Marketing (Pty) Ltd and Sasol Oil (Pty) Ltd.
Dispute Over Crude Oil Transport Tariffs
The legal dispute centered on crude oil transport tariffs. Transnet transported crude oil from Durban to the Natref refinery. The Natref refinery is jointly owned by Total and Sasol.
Agreement History
| Year | Event |
|---|---|
| 1967 | Original agreement between Total, Sasol, and the South African government. |
| 1991 | Agreement varied by an exchange of letters. |
| Cancelled | Agreement was later cancelled. |
The core issue was the “neutrality principle.” This principle ensured Natref was neither advantaged nor disadvantaged by its inland location.
High Court Ruling
The court ruled in favor of Total and Sasol. The judgment addressed the application of the neutrality principle. There was uncontested evidence that Total and Sasol made substantial transport profits.
Transnet’s Response
Transnet is disappointed by the judgment. The company intends to appeal the ruling. Transnet is in the process of instructing its legal team.
Key Points from Transnet’s Statement
| Date | Event |
|---|---|
| June 18, 2024 | High Court ruling in favor of Total and Sasol |
| June 20, 2024 | Transnet announces intention to appeal |
Financial Implications
The judgment could have significant financial implications. Total and Sasol sought recovery of amounts paid to Transnet. These amounts were for crude oil conveyance in Transnet’s pipeline.
Possible Financial Impact
| Factor | Impact Description |
|---|---|
| Amounts Paid Recovery | Total and Sasol could recover substantial amounts from Transnet. |
| Transport Profits Evidence | Court found evidence of significant transport profits during the claim period. |
Background of the Dispute
The original agreement was concluded in 1967. It was between Total, Sasol, and the South African government. The agreement was varied in 1991. This was also done through an exchange of letters.
The agreement was later cancelled. Despite its cancellation, the neutrality principle was central to the dispute. The principle was meant to neutralize location advantages or disadvantages.
Future Legal Steps
Transnet is taking steps to appeal the judgment. The company is working with its legal team. They are preparing the necessary legal documents.
Steps in the Appeal Process
| Step | Description |
|---|---|
| Legal Team Instruction | Transnet is instructing its legal team to appeal. |
| Appeal Preparation | Legal documents are being prepared for the appeal. |
Potential Market Reactions
The appeal could impact investor confidence. Transnet’s bond code is BITRA. Investors will be watching the appeal process closely.
Transnet’s Market Presence
| Aspect | Details |
|---|---|
| Bond Code | BITRA |
| Company Status | Incorporated in South Africa |
| Impact of Appeal | Potential effect on investor confidence |
Conclusion
Transnet is determined to appeal the High Court’s decision. The case revolves around a historical agreement and significant transport profits. Investors and stakeholders will be keenly observing the developments.