How the illicit fuel trade is robbing SA of billions per year

The Citizen

2 days ago

Investigators have found some diesel tankers where the fuel had a paraffin content of 68%.
The prevalence of illicit fuels in South Africa is a growing concern for the country's financial and consumer interests.
Much like illicit alcohol and cigarettes, fuel products are smuggled, underreported and illegally manufactured or altered for criminal gain.
The South African Revenue Service (Sars) reported that illicit fuels cost the fiscus roughly R3.6 billion per year, while police have identified 23 hotspots in three provinces.
Illicit fuel trade
Gauteng, Mpumalanga and KwaZulu-Natal are the hardest hit as syndicates operate in close proximity to Mozambique's capital.
'Over the past decade, countries along the Maputo corridor have become primary targets of the illicit fuel trade, which is driven by organised criminal networks that smuggle and illegally adulterate fuel,' stated Sars.
Gathered intelligence led to search and seizure operations at fuel storage facilities and depots, where fuel viscosity and composition are tested in tankers.
Sars state that common tactics involve importers declaring fuel by 20 to 30% or diluting fuels with harmful additives.
'Sars has also detected a national trend, where many of the fuel-storage and distribution depots are involved in the adulteration of all fuel products, especially through illegal mixing of diesel with paraffin.'
'In some cases, adulterated diesel – analysed in these investigations – had up to 68% paraffin content,' Sars said.
Negative effects of paraffin
In January 2024, the Department of Mineral Resources and Energy found 70 fuel stations that were selling diesel adulterated with paraffin.
Toyota South Africa Motors explained at the time that paraffin drastically deteriorates engine lubrication, as well as the cleaning of moving parts and the conditioning of seals.
'These components will fail with the repeated use of paraffin. Furthermore, the flashpoint of paraffin is lower than diesel, which could lead to engine knock, which can cause catastrophic engine failure,' said TSAM President and CEO Andrew Kirby.
In the past four months, authorities have discovered just over 950 000 litres of contaminated diesel and assets worth R367 million.
Authorities opened 13 criminal cases and impounded 12 transportation trucks carrying an average of 15 000 litres of falsely declared fuel upon import.
Additionally, two washrooms — one of them mobile — were shut down. These washrooms are used to add chemicals to the fuel mix, which help to disguise illegal additives.
Attack on society
The multi-departmental operations include Sars' trade investigators, police, and the National Joint Operational and Intelligence Structure.
Sars Commissioner Edward Kieswetter thanked authorities and warned criminals not to underestimate South Africa's resolve in clamping down on illicit trade.
'The criminal syndicates engaged in these brazen acts have become emboldened to act callously, with no restraint, in pursuit of their rapacious and criminal gains.
'These acts threaten the very foundation of our society. Our message is clear: we will spare no efforts to crush them,' the Commissioner concluded.
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