Scenario 8
Green Connection's
Kicking it into touch
February 2024
Description
PetroSA has a huge shortfall in its budget for rehabilitation and decommissioning of facilities, which must be addressed by February 2024. It was reported in 2020 that this cost was R12.43bn, of which PetroSA has R2.78bn set aside. There is a loophole that says it can buy itself 5 more years of time by entering into a payment agreement with the minister.
Set-up
You are the CEO of PetroSA and you’re looking at a financial black hole. At the end of 2020, you knew you were R9.4 billion short of the R12.4bn you needed to set aside under the terms of the National Environmental Management Act 1998 (NEMA)[33], which governs issues such as rehabilitation and decommissioning of facilities… Some of this money is for cleaning up toxic waste left behind after a facility is closed, and it has to be handed over to the government within two years, but the prospects aren’t looking good. Even though directors are still getting bonuses and wasteful expenditure is up in the billions, you’ve not been putting the pennies aside for this one. This is serious, if you don’t sort it out, you could face 10 years in prison!
The dilemma
That’s a lot of cash to find at short notice. Do you…
