By Jessica Resnick-Ault and Florence Tan

NEW YORK/SINGAPORE (Reuters) – China’s Sinopec is nearing a deal to buy Chevron’s South African oil assets for up to $1 billion to secure its first major refinery on the continent, several people familiar with the matter said.

China Petroleum and Chemical Corp, or Sinopec, Asia’s largest oil refiner, was the last bidder remaining, and close to a deal with Chevron after an auction that spanned more than a year for its refinery, retails business and storage terminals.

French oil firm Total and commodity traders Glencore and Gunvor looked at the assets, Reuters reported last year.

The South Africa government’s desire to keep the refinery operating has nevertheless proven to be a major stumbling point for buyers who would prefer to convert the site into a more profitable storage terminal, sources said.

Sinopec is in discussions with the government on ways to keep the 110,000 barrels per day refinery in Cape Town running, but talks could still fail, sources said.

The sources declined to be identified because they were not authorised to discuss the matter publicly.

Chinese oil companies and merchant traders have become more visible in chasing refinery assets that come on the market as oil majors reshape asset portfolios.

Sinopec declined to comment.

Chevron spokesman Braden Reddall said “the process of soliciting expressions of interest in the 75 percent shareholding is ongoing”. Plans to sell the stake in the South African business, including the Cape Town refinery, were first announced in January 2016.

Besides the refinery, Chevron has interests in a lubricants plant in Durban on the east coast, storage tanks and a network of Caltex service stations, making it one of South Africa’s top five petroleum brands.

Financial advisor Rothschild & Co is helping Chevron on the sale of the assets.

The remaining 25 percent interest is held by a consortium of Black Economic Empowerment shareholders and an employee trust.

(Additional reporting by Ron Bouss and Dmitry Zhdannikov in London, Joe Brock in Johannesburg and Chen Aizhu in Beijing; writing by Anshuman Daga; editing by Kenneth Maxwell and Susan Fenton)

Read more

JOHANNESBURG (Reuters) – Investment company Allan Gray said on Friday its 16 percent stake in Net1 allowed it to call a shareholders’ meeting over the payment technology provider’s handling of the scandal over a South African welfare contract.

South Africa’s Constitutional Court was set to rule on Friday in a case concerning the unlawful tender of a contract to Net1 unit Cash Paymaster Services (CPS) to manage welfare benefits to 17 million people.

The stakes are high as the welfare system is a lifeline for South Africa’s most vulnerable and includes more than 11 million child support grants, many of whom would go hungry without the monthly payment.

Allan Gray could push for the removal of the Net1 board, Chief Investment Officer Andrew Lapping was quoted in the Business Day newspaper.

“Sixteen percent allows us to call a shareholders’ meeting,” Allan Gray Chief Operating Officer Rob Dower told Talk Radio 702.

Friday’s looming judgment by the country’s top court stems from a case brought by applicants who want it to take oversight of a new contract.

South African President Jacob Zuma said in parliament on Thursday there was no “crisis”. Earlier this week the country’s chief justice placed the blame for the debacle squarely on the shoulders of Social Development Minister Bathabile Dlamini, calling her inaction incomprehensible.

The creation of a welfare safety net which supports one in three South Africans has been one of the signature achievements of the ruling African National Congress (ANC), in power since the end of white apartheid rule in 1994.

The chaos in South Africa’s social security agency comes three years after the Constitutional Court ruled that the tender won by CPS was illegal.

The government was given time until April 1 to take responsibility for social service payments or find a new provider, but it has so far failed to do so, raising concerns that grants may not be paid on time next month.

(Reporting by Ed Stoddard; Editing by James Macharia)

Read more

By Felix Onuah

ABUJA (Reuters) – Nigerian lawmakers aim to pass the 2017 budget by the end of March, the president of the upper house of parliament said on Tuesday, following a meeting with President Muhammadu Buhari.

The budget lays out plans to pull Africa’s largest economy out of its first recession for 25 years, largely prompted by low global prices for the oil it produces and by attacks on energy facilities in the OPEC member’s Niger Delta oil hub last year.

Buhari, a 74-year-old former military ruler who has faced rising disenchantment over his handling of Nigeria’s economy, presented his record 7.298 trillion naira ($23.21 billion) budget to lawmakers in December.

“This month is our deadline to finish work on the budget and return it to the executive,” Senate President Bukola Saraki said after the meeting with Buhari and the head of parliament’s lower house. “We are working very hard to ensure we meet that deadline.”

The budget must be agreed by lawmakers before the president can sign it into law.

The 2016 budget became law in May last year after being delayed by several weeks of wrangling between the government and the Senate.

Saraki said he had also briefed Buhari at their meeting on the activities of parliament during the president’s lengthy absence due to illness.

Buhari resumed his presidential duties on Monday after spending seven weeks in Britain on medical leave for an undisclosed ailment.

Saraki said the issues discussed with Buhari had included “stability in the Niger Delta” and the $1 billion Eurobond issued by Nigeria last month.

Vice President Yemi Osinbajo drove policy implementation in Nigeria, Africa’s most populous nation, during Buhari’s absence.

($1 = 314.5000 naira)

(Writing by Alexis Akwagyiram; Editing by Gareth Jones)

Read more

JOHANNESBURG (Reuters) – S&P Global Ratings reiterated its concerns on Tuesday about weak economic growth, political tensions and policy reform in South Africa, which faces the prospect of downgrades to its sovereign credit ratings which would raise the cost of borrowing.

The political temperature has been rising in Africa’s most industrialised economy ahead of the ruling African National Congress (ANC) party’s key policy and leadership conferences this year, to chart the country’s economic and political course. A successor to President Jacob Zuma as head of the party is due to be elected at the ANC’s conference in December.

“If we see a lot increasing political tensions, infighting in state institutions which could derail the government’s plans in boosting economic growth then that can impact on our forecasts on growth,” Gardner Rusike, S&P associate director told a conference.

S&P has cited “political turmoil and tension” before and the issue clearly remains high on the investment radar screen.

Growth has also been a persistent concern. South Africa’s economy grew by 0.3 percent in 2016 versus 1.3 percent in 2015, well short of the government’s target of 5 percent.

(Reporting by Olivia Kumwenda-Mtambo; Writing by Ed Stoddard; Editing by James Macharia)

Read more