Petrol 93 M19.95 Petrol 95 M20.15 Diesel 50PPM M21.20 Domestic Paraffin (Retail) M15.20
Petrol 93 M19.95 Petrol 95 M20.15 Diesel 50PPM M21.20 Domestic Paraffin (Retail) M15.20
Facebook Linkedin

Our History

Overview of

Petroleum Fund

During South Africa’s apartheid era, the country faced significant challenges in sourcing and importing crude oil for refining. In response, the Southern African Customs Union (SACU) countries came together to form the Interstate Oil Committee (IOC), a collaborative platform designed to streamline the procurement and importation of crude oil from international markets. To support this initiative, SACU members contributed to the Equalisation Fund (EF), managed by the Republic of South Africa through the Central Energy Fund.

 

With the end of apartheid, the role of the EF diminished, and SACU member states stopped their contributions, with each receiving their share of the returned funds. In Lesotho, these returned funds paved the way for the creation of the Petroleum Fund (PF), aimed at ensuring that the financial benefits would directly impact the end users of petroleum products in the country.

 

Officially approved by the government in 1995 and legally established under the Petroleum Fund Legal Notice No. 96 of 1997, the PF is governed by the Lesotho (Petroleum Fund) Regulations Legal Notice No. 129 of 2021. Its mission is to enhance the security of Lesotho’s fuel supply and stabilise fuel prices during times of crisis, ensuring a resilient energy future for the nation.

The Petroleum Fund has been established with a clear mandate to enhance the stability, accessibility, and safety of petroleum products in Lesotho. Under the supervision of the Minister responsible for Finance, the Fund is responsible for the following key objectives:

  • Assessing, collecting, and receiving a specified petroleum levy.
  • Financing initiatives that include:
  1. Stabilising petroleum product prices.
  2. Procuring petroleum products during times of crisis.
  3. Developing and maintaining national storage facilities for petroleum products.
  4. Conducting research and studies related to the petroleum sector.
  5. Improving the distribution and accessibility of petroleum products across the country.
  6. Enhancing the safety standards of storage facilities.

An additional mandate was granted through the Fuel and Services Control (Delegation) Legal Notice No. 32 of 2021. This delegated authority allows the Petroleum Fund to regulate fuel pricing and determine the timing of fuel sales in Lesotho, further strengthening its role in ensuring fuel security and market stability.

The Petroleum Fund is governed by a Board of Directors appointed by the Minister responsible for Finance. The Board is composed of Chairperson, representatives from the Ministries responsible for Energy, Finance, and Transport, along with one representative from the Lesotho Chamber of Commerce and Industry, and three Independent Members. The day-to-day operations of the Fund are managed by the Secretariat, led by the Chief Executive Officer.

The Board operates through three key Committees to ensure effective oversight and strategic direction, namely:

  • Audit and Risk Committee
  • Projects Financing Committee
  • Human Resources and Remuneration Committee

Each Committee is comprised of three Board Members selected for their expertise in relevant areas.

In adherence to best corporate governance practices, the Fund is required to provide regular reports to the Honourable Minister of Finance, including:

 

  • Annual Business Plan and Budget.
  • Annual Report with Audited Financial Statements.
  • Quarterly Progress Reports on the implementation of the Business Plan and Budget.

 

The Board convenes four quarterly meetings each year, in addition to four committee meetings per committee. Special meetings may also be called to address urgent issues as they arise, ensuring the Fund remains responsive and proactive in carrying out its mandate.

In March 2020, the Petroleum Fund launched a new Strategic Plan, which came into effect on April 1, 2020. This plan serves as a roadmap to enhance the Fund’s effectiveness in fulfilling its core mission.   To enhance alignment with international standards and amplify its impact, the Fund undertook a comprehensive review of its Strategic Plan and governing policies, leading to significant amendments in April 2023. Furthermore, new policies were introduced to strengthen the Fund’s dedication to responsible corporate practices.   Acknowledging the ever-evolving nature of the energy sector, we maintain an ongoing review process. As the Fund navigates emerging challenges, we are dedicated to continuously revisiting and enhancing our policies, ensuring they remain effective, adaptable, and aligned with industry advancements.