PetroSA 2011 Annual Report

ANNUAL REPORT 2011
PetroSA 2011 ANNUAL REPORT
Physical Address: The Petroleum Oil and Gas Corporation of South Africa (SOC) Ltd,
151 Frans Conradie Drive, Parow 7500, Republic of South Africa
Tel: +27 21 929 3000, Fax: +27 21 929 3144
Postal Address: The Petroleum Oil and Gas Corporation of South Africa (SOC) Ltd, Private Bag X5,
Parow 7499, Republic of South Africa
WWW.PETROSA.CO.ZA
WORLD CUP EXPENDITURE
The total expenditure on the 2010 Soccer World Cup (inclusive of travel and excursions) amounted to R16 816 439.
2011 2010 Total

Quantity R'000 R'000 R'000
Ticket costs
Tickets acquired 1 240 569 13 952 14 521
Distribution of tickets
Clients/Stakeholders 368* 569 4 696 5 265
Accounting authority
Executive 26 – 359 359
Non-executive 43 – 587 587
Senior management 80 – 884 884
Other employees 597 – 5 899 5 899
Other government entities 113 – 1 474 1 474
Media 13 – 54 54
Total ticket costs 569 13 952 14 521
*Two tickets were missappropriated.
Travel costs (includes accommodation)

Clients/Stakeholders – – –
Accounting authority
Executive 158 – 158
Non-executive 201 – 201
Senior management 327 – 327
Other employees 233 – 233
Transport to final and tour to Soweto 34 – 34
953 – 953
Purchase of other World Cup apparel

Bafana Bafana authentic soccer jerseys 2 000 1 198 – 1 198
Vuvuzelas 140 5 – 5
Bafana Bafana beanies 1 500 59 – 59
Bafana Bafana scarves 1 500 76 – 76
World Cup memorabilia 140 4 – 4
Total other costs 1 342 – 1 342
Total 2010 World Cup expenditure 2 864 13 952 16 816
This report is printed on triple green paper. By using certified green paper we have the assurance that the manufacturing process was environmentally
responsible, contributing to the sustainability of the planet’s resources. Triple green paper is produced using renewable fibres such as sugar cane,
elemental chlorine-free bleaching and sustainable afforestation. The paper is recyclable and biodegradable.
PetroSA has reduced the number of copies printed and we have posted an electronic version on our website for quick and easy referencing. Our web
address is www.petrosa.co.za
PetroSA ANNUAL REPORT 2011 137

CONTENTS
Our Mission, Our Vision, Our Values 2

Group Profile 3
Business Highlights 4
Organisational Structure 6
The Board 8
Chairman’s Statement 12
Executive Directors 14
Executive Management 14
Chief Executive Officer’s Report 16
Chief Financial Officer’s Report 20
Vision 2020 22
• Ensuring our sustainability 23
• Growing our company and securing
South Africa’s liquid fuel supply 30
• Transforming the company, the sector and
society 33
• Ensuring safety, health, environment
and quality 39
• Significant contributions to corporate social
investment 42
Annual Financial Statements 46
Our Mission
PetroSA will be the leading provider
of hydrocarbons and related quality
products, by leveraging its proven
technologies and harnessing its
human capital for the benefit of its
stakeholders
Our Vision
To be the leading African
energy company
Our Values
• Integrity
• Competitiveness
• Corporate Citizenship
• Harmonious Relationships
with all Stakeholders
2 PetroSA ANNUAL REPORT 2011

The Petroleum Oil and Gas Corporation of South Africa
GROUP PROFILE (SOC) Limited (PetroSA) is the national oil company of
South Africa and is registered as a commercial entity
under South African law. PetroSA is a subsidiary of the
Central Energy Fund (CEF), which is wholly owned by
the State and reports to the Department of Energy.
The company holds a portfolio of assets that spans
the petroleum value chain, with all operations run
according to world-class safety and environmental
standards. PetroSA was formed in 2002 upon the
merger of Soekor E and P (Pty) Limited, Mossgas (Pty)
Limited and parts of the Strategic Fuel Fund, another
subsidiary of CEF.
The core business activities of PetroSA are:
• the exploration and production of oil and natural gas;
• the participation in, and acquisition of, local as well as
international upstream petroleum ventures;
• the production of synthetic fuels from offshore gas at
one of the world’s largest Gas-to-Liquid (GTL) refineries
in Mossel Bay, South Africa;
• the development of domestic refining and liquid fuels
logistical infrastructure; and
• the marketing and trading of oil and petrochemicals.
PetroSA operates the FA-EM, South Coast gas fields as
well as the Oribi and Oryx oil fields. The producing gas
fields provide feedstock to the Mossel Bay GTL refinery.
Outside South Africa, the company has exploration
acreage in Equatorial Guinea and Namibia.
PetroSA’s GTL refinery produces ultra-clean, low-
sulphur, low-aromatic synthetic fuels and high-value
products converted from natural methane-rich gas
and condensate using a unique GTL Fischer Tröpsch
technology. Key commodities produced include
unleaded petrol, kerosene (paraffin), diesel, propane,
liquid oxygen and nitrogen, distillates, eco-fuels
and alcohols. Its world-class synthetic fuels and
petrochemicals are marketed internationally.

BUSINESS HIGHLIGHTS
R831 million
net profit
F-O FIELD
F-O OFFSHORE
DEVELOPMENT
GAS PROJECT
WILL SUSTAIN GTL
APPROVED
REFINERY
MOSSEL BAY
SAFETY RECORD
GTL REFINERY:
ACHIEVES TARGET
THE WORLD’S
OF LESS THAN 0.4
2ND LARGEST
DISABLING INJURY
COMMERCIAL GTL
FREQUENCY RATE
REFINERY
DEVELOPMENT OF
BUILDING OUR TEAM
SOUTH AFRICA’S
AND STAKEHOLDER
LARGEST SEAWATER
RELATIONS THROUGH
DESALINATION PLANT
THE WORLD CUP
AT MOSSEL BAY
STRIVING TO BECOME
WORKING TOWARDS
A SIGNIFICANT
DEVELOPING WOMEN
PLAYER IN SOUTHERN
LEADERSHIP SKILLS
AFRICA’S PETROLEUM
IN OIL AND ENERGY
INDUSTRY BY 2020

R30 MILLION RECERTIFICATION
SPENT ON OF ISO 9001 SHOWS
CORPORATE SOCIAL OUR WORLD-CLASS
INVESTMENT QUALITY
SUBSTANTIAL
VALUES DRIVEN
PROGRESS MADE IN
LEADERSHIP
EVALUATING WEST
PROGRAMME
COAST GAS AND OIL
INITIATED
POTENTIAL
DOWNSTREAM
MARKET ENTRY 14% INCREASE IN
OPPORTUNITIES BBBEE VOLUMES
EXPLORED
R36 million
spent on employee training
and development

ORGANISATIONAL STRUCTURE
PRESIDENT AND CEO
CORPORATE SECRETARIAT INTERNAL AUDIT
OFFICE OF THE CEO RISK AND COMPLIANCE
CORPORATE TRADING,
NEW VENTURES: NEW VENTURES:
FINANCE STRATEGY AND OPERATIONS SUPPLY AND HUMAN CAPITAL
UPSTREAM MIDSTREAM
PLANNING LOGISTICS
The company structure comprises the Office of the CEO

and seven other divisions, namely: Finance; Corporate
Strategy and Planning; Operations; Trading, Supply and
Logistics; New Ventures: Upstream; New Ventures:
Midstream; and Human Capital.

Finance Trading, Supply and Logistics
The Finance Division manages the company’s fiscal The Trading, Supply and Logistics Division markets the GTL
resources and advises the business on its financial and refinery’s products in South African and international markets,
commercial transactional responsibilities in a manner and procures supplementary feedstock and blendstock for the
that guarantees compliance. The division manages all GTL refinery. PetroSA trades in condensate, crude oil, fuel and
accounting, treasury, procurement, information systems petrochemical products through this division. The division also
and insurance functions of the company. manages the downstream marketing of PetroSA’s products to
wholesale customers.
Corporate Strategy and Planning
The Corporate Strategy and Planning Division facilitates New Ventures: Upstream
the development and monitoring of the company’s The New Ventures: Upstream Division oversees the
corporate strategy. It manages a planning and reporting exploration and production business of PetroSA and is
framework that monitors and promotes organisational responsible for growing the company’s reserve portfolio
performance. The Corporate Investment Portfolio, through the acquisition of equity in joint ventures
Economics, Business Intelligence, Intellectual Property, with other oil and gas companies, as well as through
Broad-based Black Economic Empowerment, Government exploration, appraisal and development activities.
Relations, Corporate Image and
New Ventures: Midstream
Communications fall within this
division. In addition, this division The New Ventures: Midstream Division
manages the company’s growing is responsible for infrastructure
portfolio of corporate social Office of the CEO projects to ensure the sustainable
investments. growth of PetroSA and uninterrupted
The Office of the CEO is security of liquid fuels supply for
Operations responsible for the company’s South Africa. The division has been
The Operations Division is responsible overall strategic direction primarily focused on the development
for the commercial exploitation of as well as the facilitation
of refining capacity in South Africa, the
the company’s producing assets. of governance within the
development of logistical infrastructure
These include the GTL refinery in organisation.
for strategic and commercial fuel
Mossel Bay, the FA-EM and stocks, as well as the technology
South Coast gas fields as well as solutions, particularly Gas-to-Liquid
the Oribi and Oryx oil fields located (GTL) technology.
in Block 9, offshore South Africa. A It comprises the following
departments: Human Capital
logistics base in Mossel Bay supports
PetroSA and third-party offshore • Company Secretariat The Human Capital Division provides
activities. Through Brass Exploration • Internal Audit human resource capacity to the
Unlimited, the division also managed • Legal Services business. The division ensures that the
the company’s 40% interest in the • Safety, Health, Environment and company attracts and retains the best
Abana oil field, offshore Nigeria. A Quality (Corporate SHEQ) talent, with the right balance of skills,
strategic disinvestment from this • Risk and Compliance experience and desire to develop to
asset was being finalised at the close their full potential to enable PetroSA
of the year under review. to deliver on its strategy.

THE BOARD
Dr Benny AM Mokaba Mr Mputumi B

Chairman Damane
BA (Hons), PhD (SOC Policy) BSc, MBA, CIS, Quality Auditor
Appointed to the Board: Appointed to the Board:
March 2011 January 2005
Dr Mokaba is a former executive Mr Damane is CEO of the Central
director of Sasol Ltd., with Energy Fund and a former chairman
responsibility for the company's of the Strategic Fuels Fund. He is
South African energy cluster. He has also currently interim CEO of the
served as chairman of the Boards of Nuclear Energy Corporation of
Sasol Oil, Synfuels, Sasol Mining and South Africa. He was instrumental in
Sasol Gas companies. Dr Mokaba drafting the Liquid Fuels Charter.
has previously held the positions of
vice-president of the Shell (Southern
Africa) Group and Group Managing
Director and CEO at Steinmuller
Africa.
Mr Yekani R Tenza Mr Dalikhaya

BCom (Acc), BCompt (Hons), R Zihlangu
MBA, CPA BSc (Min Eng), MDP, MBA
September 2009 December 2006
Mr Tenza is a director of Highbury Mr Zihlangu is a director of various
Solutions (Pty) Limited and a non- investment and mining companies.
executive director of the Central He has held positions as CEO and
Energy Fund and Strategic Fuel Fund executive in various well-known
Association. He is a former president companies, including Alexkor and
and CEO of the Foskor Group Limited. Impala Platinum.
Previous directorships include
Foskor Limited, Telkom Limited and
Medscheme (Pty) Limited.
Dr Zavareh Adv. Linda Makatini

Rustomjee BA (Law), LLM
BSc (Chem Eng), MPhil Appointed to the Board:
(Development Economics), PhD January 2010
(Economics) Adv. Makatini is an admitted advocate
Appointed to the Board: of the High Court and is currently
September 2009 CEO of Pinnacle Incubator Hub.
She was an adviser to the Minister
Dr Rustomjee is an independent of Minerals and Energy and to the
consultant. He currently serves on the then Deputy President Zuma. She is
Boards of the Electricity Distribution currently chairperson of the State
Industry Holdings, and South African Diamond Trader and a member of the
Gas Development Company and Central Energy Fund and Strategic
Business Partners Limited. His Fuels Fund Boards. She also chairs
previous Board memberships include the Mamane Jah Foundation &
Sasol, BHP Billiton SA, the Industrial Education Trust and has held various
Development Corporation, National positions in the Petroleum Agency,
Empowerment Fund, and the Council the National Energy Regulator
for Scientific and Industrial Research. of South Africa, the Council for
Dr Rustomjee was formerly a Director- Geoscience and the Jacob Zuma
General of the Department of Trade Educational Trust.
and Industry and executive director:
Southern African Energy at BHP
Billiton.
He also served as an adviser to the
Ministers of Trade and Industry, and
Minerals and Energy.
Ms Nondumiso Ms Esther Letlape

Medupe B Admin, BA (Hons) (Industrial
BCom (CA)SA Psychology)
January 2010 March 2011
Ms Medupe is a founding director of Ms Letlape is currently HR director
Indyebo Consulting and has many at SAPPI Southern Africa. She
years’ experience in internal auditing, previously served at Sasol Oil as a
risk management and financial human resources executive.
management. She was director: Ms Letlape has extensive experience
financial planning and budgeting in in human resource management and
the Gauteng Department of Finance has served at various organisations
and general manager of including JIC Mining, a division of
the Johannesburg City Parks. Mvela Mining; Murray & Roberts
Ms Medupe is a Board member of Construction; and Transwerk, a
City Lodge and Metro File. division of Transnet.

Mr Zingisa Mavuso
BA, MSc (Energy, Oil and Gas
Management)
Appointed to the Board:
June 2009
Mr Mavuso is the chief director:
petroleum controller responsible
for licensing and compliance at
the Department of Energy. He
has extensive experience in trade
negotiations and international trade
with the Department of Trade and
Industry. Mr Mavuso is a former
South African Trade Representative
to the World Trade Organisation
in Geneva.
Mr Musa M Zwane
MSc (Industrial Chemistry), MBA
March 2011
Mr Zwane is currently CEO of
South African Airways Technical. He
previously held various positions at
Sasol, including managing director,
Sasol Gas; General Manager Sales
and Marketing, Sasol Gas and
General Manager: Heating Fuels,
Sasol Oil and was also a member of
the executive team at Sasol Synthetic
Fuels. Prior to Sasol, Mr Zwane
was chemical services manager
with Eskom and a Senior research
scientist at AECI.
Ms Nonhlanhla
Jiyane
ND (Analytical Chemistry),
BCom, MA Acc (Taxation),
CA(SA)
March 2011
Ms Jiyane has extensive experience
in cost accounting, general auditing,
business consulting, bookkeeping
and taxation. She is currently
managing partner at Chili & Co (a
firm of accountants and auditors). Her
previous positions include director and
manager at Ngubane & Co, part-time
audit lecturer at the University of
Zululand, manager for special projects
at SARS, and cost and chemical analyst
at Shell & BP Lubricants. She currently
serves on the Boards of Kwezi Mining,
Thebe Investments and Gannet.
Mr Andrew Conway
Gaorekwe Molusi
BA (Journalism), MA
March 2011
Mr Molusi is a veteran of the
media industry in South Africa. He
serves on the Boards of African
Media and Entertainment, Caxton
CTP Printers and Publishers,
Johannesburg Tourism Company,
Rhodes University, Sishen Iron Ore
Company and Business Against
Crime SA. His numerous previous
Board directorships include Print
Media South Africa, Newspaper
Association, World Association of
Newspapers and South African Union
of Journalists.

THE BOARD (CONTINUED)

CHAIRMAN’S STATEMENT
Benny Mokaba
Foundations
for sustainability and
growth in place
Overview
Since this is my first report as Chairman of PetroSA, it is more of
an account of the efforts and diligence of my two predecessors,
Dr Popo Molefe and Advocate Linda Makatini. This is particularly
so in the case of Advocate Makatini, who acted as chair of the
Board for a large part of the year under review. The contribution
of both to PetroSA is highly appreciated. I am humbled by the
appointment and mandate to serve our country as chairman
of South Africa’s national oil company, in the midst of all the
challenges and opportunities ahead of us.
Despite a global environment fraught with challenges, While we are under no illusion about the enormity of
ranging from commodity price volatility and increased the socio-economic developmental needs of South
competition for hydrocarbon resources, through to Africa and the region, we believe that the company is
tightening climate and environmental constraints, PetroSA on a firm footing to make a meaningful contribution
was able to return to profitability in the year under review. to the cause of security of energy supply, job creation,
Poised to Enact Vision 2020 poverty alleviation and societal transformation.
The 2010/2011 financial year provided a firm platform

not only for PetroSA’s sustainability, but also for the
growth envisaged by the company’s Vision 2020 We are set to achieve our
Growth Strategy, which will see PetroSA becoming
a more significant player in the South African and Vision 2020 strategic objective
regional petroleum industry by 2020.

F-O Field Development will Sustain GTL
Refinery for Some Years
F-O field development
Some progress has been achieved towards the goal of will extend life of Mossel
sustaining the company’s main revenue earner, the Mossel
Bay Gas-to-Liquids (GTL) refinery. It gives me comfort to
Bay GTL refinery
note that, through the development of a key domestic
offshore gas field, the F-O field off the South Coast, the
productive lifespan of this refinery has been extended.
Largest Desalination Plant in South Africa
This creates further opportunities for the continued Under Construction
sustainability of the plant, which remains the world’s second
We have also made progress in other areas, including averting
largest commercial GTL refinery and is by far the largest
a potentially disastrous water crisis resulting from a drought
employer in Mossel Bay, the economic hub of South Africa’s
of historic proportions, through interventions with other
Southern Cape region.
stakeholders. This saw the construction in Mossel Bay of what
The extension of the GTL refinery’s lifespan serves to is set to be the largest desalination plant in the country.
underscore PetroSA’s commitment to South Africa’s call for
the continued beneficiation of local hydrocarbon reserves,
Gender Equity a Pressing Challenge
while minimising the country’s carbon footprint through the While some progress has been made regarding the
exploitation of natural gas. company’s gender profile, we are still not where we need
to be in this important area. My Board and the Executive
Review of New Refining Options Under Way Management team have committed to leaving no stone
The quest for growth and national energy supply security unturned to address this challenge.
has seen some progress in the company’s proposal for new
Already I am pleased to see a growing number of suitably-
refining capacity. While the organisation had targeted the
qualified women moving up the ranks and making an
commencement of the final technical engineering studies
increasingly meaningful contribution towards the success of
– the Front-End Engineering and Design (FEED) studies – by
the organisation. It is equally encouraging that the make-up
the close of the financial year, concerns raised by various
of the Board is such that 30% of the members are women.
stakeholders regarding the size of the project and market
demand have been taken on board. Ensuring Organisational Stability
Therefore, we are now in the process of reviewing this The Board is committed to filling the vacant position of
aspect of the project. This will include exploration of a chief executive officer as a matter of urgency. This is vital for
broader range of national refining capacity-expansion the stabilisation of the organisation at this crucial moment,
options, still with the intention of commissioning a refinery especially in view of our growth. This will require all hands
in the latter part of this decade. on deck on the part of the company and its leadership.
Finally, I wish to express my sincere gratitude to our customers,
In October 2010, we our partners, the Minister of Energy and the Government
of South Africa, other key stakeholders, my fellow Board
successfully hosted the members (including those who left the Board in the year
President of South Africa, under review), the Executive Management team and all
staff members for their unrelenting efforts to make PetroSA
Jacob Zuma, and the a success. I wish to assure all stakeholders – both external
Minister of Energy, Dipuo and internal – that we intend to do our utmost to build this
organisation to be the leading African energy company.
Peters, at the GTL refinery Thank you.
in Mossel Bay. This was
the first such event in the
history of the company
and reaffirms the national
significance of PetroSA as
the national oil company. AMB Mokaba (PhD)

EXECUTIVE DIRECTORS
Mr Nkosemntu G Nika
CFO
BCom, BCompt (Hons), CA(SA), AMP
Appointed as an executive director: September 2003
Mr Nika was previously Executive Manager: Finance at the Development Bank
of Southern Africa. He has held various internal auditing positions at Eskom,
Shell and Anglo American Corporation Limited. He is a non-executive Board
member of the Industrial Development Corporation and chairs the Board Audit
Committee, and Governance and Ethics Committee.
Adv. Sindi V Ngaba

Company Secretary
BJuris, LLB, LLM, MDP, SMP
Appointed as company secretary: November 2002
Adv. Ngaba is an admitted advocate of the High Court. She has held various legal
advisory positions at the Cape Peninsula University of Technology and Transnet
National Ports Authority.
EXECUTIVE MANAGEMENT
Dr Nompumelelo Siswana
Vice-president: Trading, Supply and Logistics
MSc, PhD (Chemical Engineering and Industrial Chemistry)
Dr Siswana has been in the oil and gas industry for more than 10 years, and has
held various positions in organisations such as BP (Southern Africa) and Engen
Petroleum Limited as well as in the former Department of Minerals and Energy.
Dr Siswana joined PetroSA in 2002 as General Manager: Corporate Planning,
Strategy and New Ventures. She was appointed to the position of Vice-president:
Trading Supply and Logistics In 2005. Dr Siswana resigned from PetroSA in
March 2011.

Mr Godwin Sweto
Vice-president: Corporate Strategy and Planning
BSc (Min Eng), MBA
An architect of PetroSA’s Vision 2020 strategy, Mr Sweto has broad domestic
and international investment valuation, planning and production experience.
His experience spans over 20 years in both the private and public sectors of the
minerals and energy industry and includes companies such as BHP Billiton, RTZ
(Palaborwa), Maptek (Johannesburg and Perth) and Lonrho (Harare). He was
appointed Vice-president: Corporate Strategy and Planning on 1 June 2008.
Mr Everton G September
Vice-president: New Ventures (Upstream)
BA, BCom, MBA
Mr September has been in the petrochemical business for more than 20 years,
mostly in marketing positions in South Africa, the United States and Europe. He
spearheaded a successful project to set up the PetroSA sales and marketing
office in Rotterdam, Holland. He joined PetroSA in 2003 and was appointed to his
current position in 2008.
Mr Darrin Arendse
Vice-president: Human Capital
B Admin, B Admin (Hons)
Mr Arendse began his career in the public sector as a generalist HR practitioner
in 1984. His career experiences have been shaped by serving in various senior HR
roles in organisations such as the City of Cape Town, De Beers and Standard Bank.
Mr Arendse joined PetroSA in February 2009.
Mr Joern Falbe
Vice-president: New Ventures (Midstream)
A Graduate in Chemical and Industrial Engineering, Technical University of
Hamburg, Germany
Mr Falbe formerly ran a highly integrated petrochemical and refinery complex
at Shell in Europe. He joined PetroSA in 2005 as Vice-president: Operations
and also represents PetroSA as a director in GTL.F1 AG, a joint venture with
Lürgi that seeks to commercialise the GTL technology. He was appointed to the
position of Vice-president: New Ventures (Midstream) in June 2007.

CHIEF EXECUTIVE OFFICER’S REPORT
Returning to
profitability
despite challenging
environment
Yekani R Tenza
Overview
PetroSA operated throughout this financial year without
major incidents, achieving relative success on most
fronts. The company maintained its excellent safety
and environmental records, and made significant
strides towards its sustainability and growth ambitions,
continuing its drive for societal transformation.
A Return to Profitability
A key highlight this year was a return to profitability.
The company achieved a turnaround from a net loss of
R356 million in 2009/2010 to a net profit of R831 million.
A company wide focus on cost control and capital

discipline helped us overcome a raft of challenges,
including reduced gas throughput from the depleting
offshore fields, as well as a strong Rand that significantly
eroded the company’s revenues.
Timely Action to Prevent a Water Crisis at

the GTL Refinery
Faced with a potentially devastating drought that
threatened the entire Southern Cape region, we
successfully implemented interventions that, together
R831 million
with some unseasonal, but timely rainfall, averted a
water supply crisis at the GTL refinery. Among the key
interventions was the construction of the country’s
net profit largest seawater desalination plant in Mossel Bay. This

15-million-litres-a-day plant is set to be commissioned
early in the next financial year.
Leveraging Relationships Through the

2010 Soccer World Cup
In a year in which South Africa successfully hosted the
FIFA 2010 Soccer World Cup, the company not only
helped ensure security of fuel supply, but leveraged
the euphoria of the tournament for team-building and
general stakeholder relationship building.

Minister of Energy, Dipuo Peters, noted that President
Zuma had brought much-needed rain with him to the
drought-stricken Mossel Bay area. It had started to
rain the day before the visit and continued while he
was in town.
President Jacob Zuma and Minister of Energy Dipuo Peters with members of the PetroSA Board and Executive in Mossel Bay
Ensuring Our Sustainability F-O field will also serve as an enabler of further
development of gas prospects near F-O, which could
Final Investment Decision for F-O Field
provide a further five year life for GTL refinery to 2025.
Our efforts to build and sustain the company continues.
Key to this is the sustainability of the GTL refinery in Seismic Acquisition Programme to Further
Mossel Bay. We are continuously searching for additional Derisk the F-O Field
gas reserves for the refinery and found proven gas reserves A seismic acquisition programme covering the greater
in the F-O field, which is located off the south coast of Block 9 area, including F-O, was embarked upon towards
South Africa. the end of the financial year. The aim of the programme is
to further derisk the F-O field and possibly identify other
This year, the project received a final investment decision
indigenous hydrocarbon prospects for future exploitation.
from the PetroSA Board. This implies that the development
of the F-O field has been sanctioned. Production from LNG and Shale Gas Other Possible Sustainability
this field is expected by 2013 and it is estimated that Measures
production from the F-O field, together with continued For the longer-term sustainability of PetroSA, the LNG
optimisation of existing fields, will maintain commercial project has been revived. The aim is to import LNG for use
operations to 2019/2020. The development of the as future supplementary feedstock for the GTL refinery.

CHIEF EXECUTIVE OFFICER’S REPORT (CONTINUED)
Growing PetroSA and Ensuring Security of Processing Seismic Data in Block Q, Equatorial
Liquid Fuels Supply for South Africa Guinea
Considering Phased-in Options for Project Mthombo In Block Q, Equatorial Guinea, the processing and
interpretation of the 1 000 km2 seismic data acquired over
Consultations with the shareholder with respect to the
the block continued.
sanctioning of project Mthombo’s Front-End Engineering
and Design (FEED) study continued. The seismic data covers almost 50% of this block in which
we hold 75% technical operating interest. We are also
Our engagements with various stakeholders, including
looking at divesting up to 40% equity in the block.
the South African Petroleum Industry, have resulted in us
strengthening the original business case for this project Transforming the Company, the Sector and
and considering alternatives and other scenarios. We Society
expect a final decision on the project before the end of the An Increase in BEE Volumes
next financial year. We continued to make strides to support BBBEE,
Pursuing Downstream Acquisitions in particularly in preferential procurement. Our BEE volumes
Sub-Saharan Africa increased from 186 million litres in 2009/2010 to
Plans to participate in the South African downstream 212 million litres in 2010/2011. This translates to a 14%
increase in BEE sales from the previous year.
market were firmed up. Divestments by the international
oil companies from the downstream sub-Saharan market
presented us with additional opportunities to pursue our
downstream objectives.
The focus remains on the acquisition of existing

downstream logistical infrastructure, together with a desire
to penetrate the sub-Saharan Africa markets.
Developing a Joint Business Plan in Venezuela
14%
This year, we finalised the reserves quantification and
certification study in Venezuela’s Boyaca 4 Block. The
next step is for PetroSA and Petróleos de Venezuela S.A.
(PDVSA) – Venezuela’s national oil company – to jointly
work on a business plan for the development of this block.
increase in
We also evaluated a number of mature fields offered by BEE sales
PDVSA as part of the memorandum of understanding
between the companies. We are currently doing an
economic assessment of revitalising these fields.

Efforts to Increase Representation and
Opportunities for Women
R30 million
Women representation in the company remained unchanged
at 26% of the total workforce. Efforts are being made to
further empower and advance women. To this end, we
sponsored and led an industry-wide women empowerment in corporate
workshop. The focus was on identifying barriers to progress,
as well as creating opportunities to advance women.
social investment
Promoting a Value-based Culture in the Company
A company wide values driven leadership programme was
initiated to instil a high performance culture within the
organisation, underpinned by ethics and sound governance
principles.
Numerous Corporate Social Investment Initiatives
On the corporate social investment front, we made several
interventions and spent over R30 million in targeted and
sustainable investments.
Learners in some townships in the Vredenberg area in
Saldanha had no school until PetroSA, together with
the provincial government, intervened to provide the
Masiphathisane Primary School. Built for R22 million,
the school has over 800 learners, and is the only school
providing Xhosa lessons in this predominantly Afrikaans-
speaking community.
We continued our support of the University of
Johannesburg’s New Generation of Scholars programme.
This involved a R9 million grant over three years to support
black, in particular women, students, doing postgraduate
studies.
We are sponsoring the building of the KwaNonqaba
community centre to the tune of R13 million. Work on
this centre began this year under review. We also provided
a R2.125 million donation as part of the Healdtown
Restoration Project, and committed R8.5 million to the
Mossel Bay municipality for community projects. Received ISO 9001
Ensuring Safety, Health, Environment and Quality recertification. This
On the safety front, the well-being of the company’s
employees remained key. There were no fatalities and code is a world-class
15 non-permanent disabling injuries were recorded. This
translates to a disabling injury frequency rate of 0.39
certification system,
against a target of less than 0.4. benchmarked against
Three environmental incidents occurred in this period. One international excellence
related to the discharge to sea of effluent that did not
comply with permit conditions. The other two incidents
models
related to diesel that entered the storm water system and
was discharged with the storm water to the beach adjacent My thanks go to my colleagues on the Executive Committee
to the Voorbaai tankfarm. for their support and hard work and to the rest of our staff.
The company remained committed and continued to support

efforts towards a cleaner and healthier natural environment.
We were awarded ISO 9001 certification by the South
African Bureau of Standards for the second time, which
represents a guarantee of quality and of the company’s
ability to fulfil customer needs and expectations. YR Tenza

CHIEF FINANCIAL OFFICER’S REPORT
Key Performance Indicators

The key performance indicators for the Group are:
2011 2010
R'm R'm % change
Turnover 10 565 8 090 31%
Operating profit (loss) 64 (1 337) 105%
Profit (loss) for the year 831 (356) 333%
Cash generated by operating activities 2 011 392 413%
Total assets 25 006 21 991 14%

Capital expenditure 197 1 275 (85%)
Total debt 1 629 1 490 (9%)
Net asset value 16 645 15 846 5%
Year-end exchange rates

ZAR/USD 6.78 7.32 (7%)
ZAR/EURO 9.64 9.85 (2%)
Average exchange rates

ZAR/USD 7.19 7.81 (8%)
ZAR/EURO 9.50 11.04 (14%)
Average crude prices 86.65 68.78 26%
Nkosemntu G Nika Performance Review

For the year under review, the group achieved a net profit of
R831 million, compared to a net loss of R356 million the
previous year. The company made R10.5 billion in revenues,
a 31% increase from the previous year (R8 billion: 2010). The
increase in revenue can be ascribed to higher product prices
resulting from higher crude oil prices, as well as an increase in
volumes sold. Crude oil prices increased by 26% ($87/bbl in
2010/2011 vs $69/bbl in 2009/2010). There was no shutdown
and no major operational challenges at the GTL refinery. This
resulted in a 25% increase in production volumes compared to
the previous year.
The SA Rand was 8% stronger against the US Dollar (R7.22 in
2010/2011 vs R7.81 in 2009/2010). The negative effect of this
was however countered by the positive volume, price and mix
variances year on year.
31%
Cash reserves increased by 18%, from R10 billion the previous
year to R11.8 billion in the period under review. Despite this,
investment income was lower as a result of declining market
rates during the year.
in revenue due to Operating margins increased by 105% due to the increase in
higher prices and revenue and a reduction in other operating expenditure. The
increase in sales reduction in operating expenditure was largely a result of the
once-off 4-well drilling campaign in PetroSA Egypt SE Warda in
the prior year. The effort was not successful commercially and
the block was subsequently relinquished in the current year.
Limited capital expenditure was incurred in the year under
review, as all efforts were geared towards the sustainability of
the GTL refinery.
Taxation
In November 2010, the tax legislation was amended
retrospectively to allow for a deduction of OP26 capital
expenditure in the 2008/2009 fiscal year.

The South African Revenue Service (SARS) reopened PetroSA’s Dividends
2008 tax assessment to accommodate this deduction. No dividends were declared in this financial year.
Consequently, the company expects a refund of R385 million
plus interest, paid as provisional tax to SARS in 2008. Preferential Procurement
For the period under review, payments made to suppliers
Accounting Policies
of goods and services totalled R7.38 billion. Of these
The accounting policies used in the preparation of the annual payments, R1.36 billion was spent on Black Economic
financial statements for the year ended 31 March 2011 are in Empowered (BEE) Suppliers with a minimum of 25.1%
accordance with SA GAAP, and consistent with those used in black ownership. This equates to 18.52% of the company’s
the previous year. total procurement spend.
Management Judgements In terms of the BBBEE codes of good practice, certain
In preparing the annual financial statements in terms of SA expenditure may be excluded from total procurement
GAAP, the group’s management is required to make certain (i.e. procurement from other organs of state, imported
estimates and assumptions that may materially affect goods and services that cannot be sourced locally, as well
reported amounts of assets and liabilities at the date of the as specific branded sole-source procurement). The total
financial statements and the reported amounts of revenues procurement expenditure from organs of state, sole source
and expenses during the reported period and the related suppliers and foreign entities was R4.82 billion.
disclosures. As these estimates and assumptions concern
The company’s total discretionary procurement for the
future events, due to the inherent uncertainty involved
period under review, in terms of the codes, equalled
in this process, the actual results often vary from the
R2.56 billion. 53% of this procurement was from BBBEE
estimates. These estimates and judgements are based on
organisations.
historical experience, current and expected future economic
conditions and other factors, including expectations of the Financial Strategy and Outlook
future events that are believed to be reasonable under the The company’s biggest internal challenge is the continued
circumstances. reliance on a single source of income, namely the
GTL refinery. After nearly 20 years in operation, the
Liquidity Management
PetroSA GTL refinery is faced with the serious challenge
PetroSA manages its cash and cash equivalents in line with of declining feedstock. This impacts the company’s
Board-approved policies. The cash portfolio is split into a sustainability and dictates that the primary focus be
core and liquid portfolio to ensure that short-term liquidity directed at securing feedstock.
needs are met, whilst maximising the return on surplus
cash. Investment counterparties are approved based on As a result, the company will continue to produce at
their assessed ratings and are actively monitored. moderated production rates. This, together with the
optimisation of current fields, is expected to prolong
Cash under management for the group increased from commercial operations beyond 2013 when first gas from
R9.9 billion the previous year to R11.8 billion, mainly due to the planned F-O Field development, aimed at augmenting
cash generated by operations and a delay in the approval current gas fields, is expected.
of projects for which internally generated cash had been
earmarked.
As at 31 March 2011, South African Rand cash and cash
equivalents were invested at a fixed rate of 6.25% (2010:
7.71%) and a floating rate of 7.50% (2010: 8.03%). The
rate of return achieved on investments declined throughout NG Nika
the financial year, in line with declining market rates. The
declining interest rate environment contributed to a 19%
decrease in interest income from R972 million the previous
year to R860 million in the period under review.
19%
PetroSA paid off the long-term loans raised for the EM gas
field development resulting in an un-geared balance sheet at
31 March 2011. The optimal funding structure for the F-O gas
field development to ensure sustainability of the company’s
Mossel Bay operations is being considered. A long-term of total company spend on
gearing ratio of 30% to 40% is being targeted, in line with BEE suppliers with 25.1%
the group’s long-term strategy and growth initiatives.
black ownership

SUSTAINING
GROWING OUR COMPANY
THE MOSSEL BAY
TO A SIGNIFICANT
GTL REFINERY AS A
INDUSTRY PLAYER, WHILE
PROFITABLE
ENSURING SECURITY OF
OPERATION AND USE AS
ENERGY SUPPLY FOR THE
A PLATFORM TO
COUNTRY
SUSTAIN OUR COMPANY
Our Vision 2020 strategic

objective is to become a fully
integrated, commercially
competitive national oil
company, supplying at least
25% of South Africa’s liquid fuel
needs by 2020.
We aim to achieve this through:
ENSURING THAT THE

ABOVE ARE CARRIED OUT
TRANSFORMING THE
IN LINE WITH THE HIGHEST
COMPANY, THE SECTOR
SAFETY, HEALTH, QUALITY
AND SOCIETY
AND ENVIRONMENTAL
STANDARDS
THE REPORT THAT FOLLOWS REVIEWS OUR PERFORMANCE AGAINST THESE FOUR
THE REPORT STRATEGIC
THAT FOLLOWS REVIEWS
PILLARS OUR2010/11
FOR THE PERFORMANCE AGAINST
FINANCIAL YEAR. THESE FOUR
STRATEGIC PILLARS FOR THE 2010/2011 FINANCIAL YEAR.

ENSURING OUR SUSTAINABILITY
PetroSA’s priority is to ensure the short-, medium- and long-term

commercial sustainability of the company. The immediate focus is
on the supply of feedstock to the GTL refinery in Mossel Bay.
Production
While non-feedstock production was unchanged during the year under review, feedstock production was higher than the
previous year.
The table below shows the non-feedstock and feedstock production over two years.
Year-on-year
2010/11 2009/10 variance
Oribi and Oryx (MMbbl) 1.26 1.07 18%
Abana (MMbbl) 0.96 1.15 (17%)
NON-FEEDSTOCK (MMBBL) 2.22 2.22 0%
FA-EM Gas (MMboe) 5.70 3.97 43%
FA-EM Condensate (MMbbl) 1.07 1.10 (3%)
SC Gas (MMboe) 2.17 2.04 7%
SC Condensate (MMbbl) 0.29 0.20 43%
FEEDSTOCK 9.22 7.31 26%
TOTAL 11.44 9.52 20%
GTL REFINERY (MMBOE) 7.15 5.30 35%
Non-feedstock Production Constant at

2.2 Million Barrels
Non-feedstock production remained constant at 2.2 million barrels
of oil over the two years, as a result of two factors:
• The domestic Oribi and Oryx oil fields production was 18%
higher than the previous year, as a result of a number of
interventions that improved the performance of the wells. This is
a remarkable performance, given the field’s depleting reserves.
• However, this performance was off-set by the poorer
performance of the Abana oil field that is situated in OML114
offshore Nigeria and operated by Moni Pulo (Ltd), the major
equity holder in the field. Production from Abana was 17%
lower than the previous year as a result of key wells being down
for prolonged periods. A strategic disinvestment from this asset
was being finalised at the close of the year under review.
The Oribi and Oryx fields

reached a 45-million-
barrel milestone this
year, a feat credited to
innovative engineering
and a dedicated team

ENSURING OUR SUSTAINABILITY (CONTINUED)
Feedstock Production Increases

Feedstock production for the year was 26% higher than the
previous year (9.22 vs 7.31 million barrels of oil equivalent).
This positive variance was mainly due to a decrease in
35%
production interruptions at the GTL plant, which resulted in an
increase in feedstock demand.
The GTL refinery production was 35% higher, an increase from
GTL refinery 5.3 million barrels of oil equivalent the previous year to 7.15 million
production barrels of oil equivalent in the year under review.
Product Supply
Curtailing Throughput to Ensure Long-term
We have reduced our Sustainability
throughput at the GTL This year, we adopted a production philosophy that curtailed
the GTL refinery throughput to about 60% of its capacity.
refinery as a strategic This was done to prolong commercial operations at the plant
measure towards until the start of supplementary feedstock production from the
F-O field in 2013. The F-O field development will start in 2012.
sustainability To supplement the reduced GTL refinery production and
ensure that the company was able to meet our obligations to
the market, we imported finished petroleum products. Diesel
import amounted to 425.889 m3 while 62.463 m3 of petrol
26%
was imported.
Optimising Storage Results in Reduced Storage
Costs and Higher Product Margins
feedstock Supply and distribution optimisation remained a key focus area
production for the company. The supply chains associated with the various
business streams were further rationalised through optimising
storage, thereby reducing storage costs. This had a positive
contribution on product margins.
Freight Savings and Higher Prices Result in Higher
Product Margins
As part of optimisation, PetroSA consolidated its shipping
contracts for supply to the Mediterranean markets and the Far
East. This resulted in freight savings, which, combined with
higher prices in this region, resulted in higher product margins.
Building an Efficient Electronic Data Interchange
System for Trading
The electronic data interchange system aims to facilitate trade
with other oil companies. The system continued to operate
increased
efficiently, with the turnaround between receiving orders from
customers, placing orders with oil industry trading partners
product margins for supply execution and billing of customers improving
through supply significantly. We enhanced the system this year to extend it to

industry orders for road and shipping.
and distribution An electronic data interchange portal will be rolled out in the
optimisation next financial year to commercial customers so that orders
can be placed online, rather than the current e-mail ordering
process. This will also be extended to rail and pipeline.
Successfully Meeting all Requirements for REACH
Registration
In December 2006, the European Union enacted legislation for
the handling of chemicals within the EU. The legislation with
the acronym REACH (Registration, Evaluation, Authorisation

20%
sales in EU
The F-O field development will sustain

operations to 2019/2020
of Chemicals) prescribed that chemicals sold with an annual accumulations and prospects in the South Coast, which are
tonnage of more than 1 000 mt per annum had to be being evaluated to define an exploration drilling programme
registered by 30 November 2010 in order to continue being to prove up additional gas resources that could be used as
sold in the EU. PetroSA successfully met all requirements for supplementary feedstock for the GTL refinery.
registration by October 2010. The next phase of the REACH
F-O Development Approved by Board
programme that is currently under way entails the drafting of
extended safety data sheets. Key among our evaluations is the F-O field development, over
which we have a 100% exploration right, and which received
Increase in Sales in European Union a final investment decision this year.
Our sales in the European Union grew by 20% year on year
Following the Board approval to go ahead with development
from 2009/2010 levels. Demand outstripped supply and
of this field, preparations to convert the exploration right
tanks ran dry by January 2011. The uncertainty and unrest in
to a production right were initiated. This will facilitate
the Middle East filtered through to Europe as higher crude
development drilling which is planned to start in 2012.
and commodity chemical prices resulted in higher net-backs
throughout the business. We estimate that production from the F-O field – which is
expected in 2013 – together with continued optimisation
The price of isopropanyl (IPA) remained above pre-crisis levels,
despite persistent problems in Greece, Ireland and Spain. This of existing fields, will maintain commercial operations to
worked well for PetroSA’s revenue base. Mosstanol L prices 2019/2020. The development of the F-O field will also serve
also rose in the period under review, but the benefit of the as an enabler of further development of gas prospects near
price increase could not be taken full advantage of due to F-O, which could provide a further five-year life for the GTL
limited supply. For a fourth consecutive year, the demand for refinery to 2025.
mosspar1925, the specialty distillate grade, was high and it On the next page is a schematic of the planned F-O field
was sold out by December 2010. development tied back to the existing infrastructure.
Exploration and Development Efforts in Seismic Acquisition Programme Embarked on
South Africa Towards the end of the financial year, we embarked on a
This year saw PetroSA continuing to evaluate gas potential seismic acquisition programme covering the greater Block 9
off the South and West Coasts. The go-ahead by the PetroSA area, including F-O. The aim of the programme is to further
Board on the F-O field off the South Coast enables PetroSA to derisk the F-O field and possibly identify other indigenous
begin preparations for drilling, planned to begin next year. In hydrocarbon prospects for future exploitation.
addition, significant work was done in the various blocks off
West Coast Exploration Shows Potential
the West Coast, which we believe hold great potential.
The West Coast holds great promise for the unlocking of gas
Evaluations on the South Coast Continue resources that could provide additional life to the PetroSA
The sustainability of PetroSA’s GTL refinery rests to a large GTL refinery, having the potential for both shallow- and deep-
extent on the exploration and development activities water oil and gas resources. The map on the next page shows
within the South Coast. There are several discovered gas PetroSA’s West Coast exploration acreage.

F-0 DEVELOPMENT PROJECT OVERALL FIELD DEVELOPMENT CONCEPT
PetroSA’s WEST COAST EXPLORATION ACREAGE

Below, we detail work done in each of the Blocks.
BLOCK 1:
SIGNIFICANT TECHNICAL WORK CONDUCTED
We have conducted significant technical work in Block 1, including completing acquisition, processing and inversion
studies of a 1 500 km2 3D seismic survey. We have also identified numerous leads and plays and preliminary well targets
have been proposed.
BLOCK 2A:
PROJECT IN A GAS DEVELOPMENT MARKETING PERIOD
A production right for Block 2A was signed in August 2009 where PetroSA holds a 24% stake in a joint venture with
Forest Oil (53.2%) and Anschutz (22.8%). At present the joint venture is in the gas development marketing period, which
is for five years, during which the work programme associated with the development plan will be suspended, allowing the
joint venture to:
• prove additional reserves through acquisition of 3D seismic data and by drilling wells;
• negotiate and sign a gas sales agreement; and
• review the construction of feasible gas infrastructure.
BLOCK 3A/4A:
NEW-ORDER RIGHTS SIGNED
New-order rights over block 3A/4A were signed in September 2010. With our joint-venture partners – BHP Billiton (60%)
and Sasol (10%) – we have reviewed past work in anticipation of the drilling of one well in the first exploration phase.
BLOCK 2C:
NEW-ORDER RIGHTS ON THE WAY
We have a 24% participating interest in Block 2C with our joint-venture partners Forest Oil (53.2%) and Anschutz
(22.8%). This is part of our strategy to gain acreage on the West Coast. Excellent progress has been made to convert the
exploration right to new-order rights over this block.
BLOCK 5/6:
TECHNICAL CO-OPERATION PERMITS STUDY UNDER WAY
PetroSA executed the second Technical Co-operation Permit over Block 5/6 on 8 July 2010. The objective of this 12-month
desktop study is to fully evaluate the oil and gas prospectivity of the block, in order to determine the commercial viability
of obtaining an exploration right.

PetroSA’s Southern African Exploration Activities as at 31 March 2011

The table below summarises the location of our southern African activities.
PetroSA
Area Block Partners Operator Status
Equity
West Coast Block 1 100% PetroSA First exploration phase
Block 2A 24% Forest, Anschutz Forest Production right
Block 2C 24% Forest, Anschutz Forest First exploration phase
Block 3A/4A 30% BHP Billiton, Sasol BHP Billiton First exploration phase
Block 5/6 100% PetroSA Technical Co-operation Permit (desktop studies)
Block 9 Tracts
South Coast E-CB, E-AA, E-CN, 55% Pioneer PetroSA Initial exploration period
E-W, E-CC, E-AG
Block 9 – Tracts F-Q,

55% Pioneer Pioneer Initial exploration period
E-P, E-DC
Block 9 – Tracts F-E,

100% PetroSA Initial exploration period
F-O
Block 11a 100% PetroSA Initial exploration period

Talent Management
PetroSA views our workforce as a cornerstone to our
sustainability and growth. Accordingly, the company adopted
a talent management framework, essentially a holistic
Darrin Arendse, PetroSA’s
approach that will help it attain our talent goals. vice-president for human
The implementation of the talent management framework capital, on its talent
is running over five years and started in 2010. For the period
under review the following milestones were achieved: management framework:
• the establishment of talent committees that will review the “It is critical to get
company’s talent profile on an annual basis and ensure continual
alignment with the business needs and strategic thrust;
everyone in the company
• a values driven leadership programme was rolled out with
to think the same way on
the objective of fostering an environment and culture where how to manage, attract
management at the various levels leads through set values; and
• job profiles were created and updated for all the functions
and retain the best talent.
within the organisation. This will serve as a building block Talent management is a
for a number of talent management interventions as
outlined pictorially below.
cornerstone of business
Employee Relations Forum today.”
Engagements between management and labour are ongoing
and are conducted within an agreed-upon employee
relations framework/forum. A breakaway session, where
representatives of management and labour representatives
retreated to an away location over two days, served to
provide the space to thrash out issues of concern and
common interest. This was done as part of the ongoing effort
to ensure harmonious industrial relations within the company.
Succession
Planning
and
Management
Recruitment Career Paths
Workforce
Planning
(Talent Job Design and Profiles Retention
Strategy
Demand)
Learning
Performance
and
Management
Development

GROWING OUR COMPANY AND CDC: Coega Development Corporation
SECURING SOUTH AFRICA’S FEED: Front-End Engineering and Design
LIQUID FUEL SUPPLY COD: Conversion of Olefins to Distillate
PDVSA: Petróleos de Venezuela S.A.
Growth and security of supply centre on projects that support

South Africa’s energy security masterplan, will grow the
company’s oil and gas reserves and provide long-term income
growth and diversification, while increasing PetroSA’s role as a
catalyst for growth in the liquid fuels sector.
PLANNED CRUDE OIL REFINERY IN COEGA

Planning for Project Mthombo, a crude oil refinery in Coega in
the Eastern Cape continued. We continued our consultations
with the shareholder with respect to the sanctioning of project
Mthombo’s Front-End Engineering and Design (FEED) study. Project Mthombo was
Numerous engagements between the company and various
stakeholders, including the South African petroleum industry, nominated in the KPMG
have resulted in the company strengthening the original and Infrastructure Journal
business case and considering alternatives and other scenarios.
We expect to have a final decision on the project in the
as one of the top 10 most
2011/2012 financial year. impactful infrastructure
Engagements with relevant ministries, including the Ministries undertakings globally.
of Rural Development and Land Reform, Public Enterprises
and Trade and Industry took place, focusing largely on the This is an important
progress of the project. We are in the process of developing endorsement that
a project development and construction support agreement
to formalise a host of essential agreements between PetroSA
reinforces PetroSA’s view
and the Coega Development Corporation (CDC). that Project Mthombo will
This agreement follows on the heads of agreement between not only ensure security
PetroSA and CDC signed in 2008 and an amendment and of liquid fuels supply for
restatement of the heads of agreement to formalise PetroSA’s
appointment as a preferred developer in the industrial zone at
South Africa but will also
Coega signed in 2009. have huge macroeconomic
Various feasibility studies of the refinery’s inside and outside benefits for the country.
battery limits infrastructure requirements were completed.
These include:
• the single-point mooring;
• marine studies and oil movement and storage; and
• the transportation of dry bulk coke and sulphur from the
refinery to the Port of Ngqura.
A detailed execution strategy, specifically for the detailed
engineering, procurement and construction phase of the
project will be finalised before entering FEED. In the interim,
we have prepared a draft procurement and contracting
strategy, in line with the execution strategy.
Work continued on the project’s sustainability framework
to provide a strategic basis for the environmental impact
assessment process and a sustainability management

framework for the project. An update on the risk matrix for Namibia – Licence Area 1711: Post-well
the project was also completed. Evaluation Continued
Limited Recourse Project Financing Structure Block 1711 is a high-risk, deep-water exploration area in
Pursued which PetroSA holds 10% interest in a joint venture with
Due to its magnitude, Project Mthombo needs to be financed Nakor Investments (70%), Energulf (10%), Namcor (7%)
by a variety of debt and equity providers, with the full and Kunene (3%). This year, post-well evaluation of the
Kunene-1 exploration well progressed.
support of stakeholders and shareholders. We have therefore
engaged potential funding partners to explore partnership Egypt – SE Warda: Relinquished due to no
opportunities within Project Mthombo. Commercial Hydrocarbons Being Encountered
We are pursuing a limited recourse project financing PetroSA is the operator of the SE Warda Block, located in
structure – which is the strongest and best-proven the Gulf of Suez. To fulfil our four-well commitment under
methodology for Project Mthombo’s financing needs – with a production sharing contract with the Egyptian petroleum
appropriate shareholder support pre-completion and limited authorities, the four wells were drilled in the block between
recourse post-completion. November 2008 and December 2009. These wells did not
encounter commercial hydrocarbons and the SE Warda Block
Study to Establish Infrastructure Needs was relinquished in the period under review.
Completed
Venezuela – Boyaca 4: Finalisation of Studies
A social management feasibility study to determine the
Allows for Development of Business Plan
infrastructure requirements for construction personnel,
Work continued under the co-operation agreement that was
including housing, town planning, personnel transport,
signed in 2008 between Petróleos de Venezuela S.A. (PDVSA),
catering, shopping, medical facilities and industrial relations
Venezuela’s national oil company, and PetroSA, and that led
in the vicinity of the Coega Industrial Development Zone was
to our participation in exploration and production activities in
completed and ready to issue for tender when FEED approval
Venezuela. The reserves quantification and certification study
is obtained.
in Venezuela’s Boyaca 4 Block was finalised.
Focus on Pursuing Downstream Acquisitions The next step is for PetroSA and PDVSA to work jointly on a
and penetrating sub-Saharan markets business plan for the development of this block.
Plans to participate in the South African downstream Venezuela – Economic Assessment of Mature
market were firmed up. Divestments by the international Fields Being Conducted
oil companies from the downstream sub-Saharan markets
We also evaluated a number of mature fields offered by
presented us with additional opportunities to pursue our PDVSA as part of the memorandum of understanding
downstream objectives: focusing on the acquisition of between the two companies. The company is currently doing
existing downstream infrastructure and penetrating the sub- an economic assessment of revitalising these fields.
Saharan Africa markets.
GTL.F1 AG: TECHNOLOGY DEVELOPMENT
INTERNATIONAL EXPLORATION OR
STRATEGIC MEANS TO ACCESS OIL AND GAS
DEVELOPMENT EFFORTS RESERVES
Equatorial Guinea – Block Q: New 3D Following Statoil’s withdrawal from GTL.F1 AG, a Swiss-
Seismic Dataset to Assist in Identifying New incorporated joint-venture company that licenses proprietary
Prospects technologies for GTL investments, PetroSA increased its share in
Block Q is a deep-water exploration asset that is located the GTL.F1 AG Joint Venture from 37.5% to 50%, with Lürgi also
offshore Equatorial Guinea in which PetroSA Equatorial increasing its equity in the venture to 50%. GTL.F1 AG remains
Guinea, a subsidiary of PetroSA, has 75% operating equity. strategic to PetroSA as a means to leveraging GTL.F1 technology
in order to get preferential access to oil and gas reserves.
To date one exploration well has been drilled in Block Q
and several risk mitigating technical studies have been PetroSA SYNTHETIC FUELS RESEARCH CENTRE
undertaken to reduce sub-surface uncertainty. This year,
DEDICATED TO COD RESEARCH
PetroSA Equatorial Guinea acquired a new 3D seismic survey
on the western portion of the block. Processing of this Following a R36 million sponsorship to the University of the
dataset has commenced and is expected to be completed Western Cape the previous year, a PetroSA Synthetic Fuels
Research Centre has been established in the South African
in the second quarter of the next financial year. The new
Institute for Advanced Materials Chemistry at the University
seismic data was acquired with a view to increasing the
of the Western Cape (UWC). PetroSA’s conversion of olefins
identification of new prospects and potential drilling targets.
to distillates (COD) pilot plant was relocated from the GTL
Continued sub-surface evaluation focuses on understanding refinery in Mossel Bay and occupies a prestigious site in a
the geological regime and identifying new plays. custom-built laboratory at UWC.

GROWING OUR COMPANY AND SECURING SOUTH AFRICA’S LIQUID FUEL SUPPLY
(CONTINUED)
The research will focus on efficiency improvements of the Conversion of olefins

conversion of olefins to distillates process that could lead to distillates (COD)
to improvements of the quality of the diesel yield. The
COD process produces specialty fuels and solvents that are technology is an
low in aromatic content, and are used as indoor fuels and
biodegradable drilling fluids.
essential part of the
An intellectual property framework was designed to provide
intricate Gas-to-Liquid
guidelines on how to effectively protect and manage (GTL) process, in which
PetroSA’s intellectual property during research collaborations
with UWC. PetroSA is a world
The research centre is staffed by seconded PetroSA personnel leader. COD is recognised
and students recruited from UWC. The project has awarded
bursaries to two MSc students and five graduate trainees to
throughout the world for
act as COD pilot plant monitors. The research centre producing some of the
is dedicated to research and development programmes
that benefit both PetroSA and UWC. The agreement of
“cleanest” fuels, through
co-operation underpins a commitment by PetroSA for a an environmentally-
five-year project ending 31 March 2015.
friendly process

TRANSFORMING THE COMPANY, THE SECTOR AND SOCIETY
The company’s transformation efforts focused on employment

equity, skills development, preferential procurement, supplier
development and socio-economic development/corporate social
investment.
Significant progress has been made with respect to This is both due to imbalances created by social engineering
transformation within the company. However, challenges in the past, which provided little opportunity for women to
remain with respect to increasing women representation at acquire the technical skills required in the industry, as well as
all levels, increasing the representation of people living with limited skills development opportunities currently offered to
disabilities and enterprise development.
women within the industry.
In the period under review the company’s BBBEE status was
The shortage of industry-specific skills amongst women
verified by Empowerdex, a SANAS-accredited verification
agency. The company’s BBBEE rating dropped from a level 2 in South Africa posed a challenge for PetroSA’s desire to
status previously to a level 3 contributor. This is attributed to increase women representation in the organisation. Women
little progress on employment equity, in particular women representation within the company, therefore, remains
representation and enterprise development. unchanged from the previous year, at 26% of the total
workforce. The company, however, remains committed to
EMPLOYMENT EQUITY identifying and developing women to actively participate
While we made significant progress regarding transformation throughout the liquid fuels industry value chain.
in the company in this financial year, we fell short in achieving
our goals around women representation and enterprise People Living with Disabilities
development. This accounts for our BBBEE status, as verified A disability awareness campaign was conducted in the year
by Empowerdex, a SANAS-accredited verification agency, under review, and resulted in 30 more employees disclosing
dropping from a level 2 status to a level 3 contributor.
their disability. The company has also, as part of its efforts to
Women Empowerment increase the representation of people living with disabilities,
The statistics on gender in the liquid fuels industry show identified and ring-fenced functions where vacancies could
an unequal picture between men and women in the sector. be filled by people living with disabilities.
“PetroSA should play

a central role in the
achievement of the
Government’s transformation
and empowerment agenda”
President Jacob Zuma, during
a visit to the PetroSA GTL
Refinery

TRANSFORMING THE COMPANY, THE SECTOR AND SOCIETY (CONTINUED)
Form EEA2 – PetroSA’s Employment Equity Status as at 31 March 2011

The table below shows the breakdown of employees by gender, nationality and race.
Total
Foreign by Total Total
Male Female Nationals Level Black Female
Occupational
Levels A C I W A C I W Male Female
Top and senior

6 5 2 10 1 2 26 14 1
management
Professionally
qualified and
experienced 125 63 16 101 58 20 5 17 11 1 417 287 100
specialists and
mid-management
Skilled technical
and academically
qualified
workers, junior
179 216 11 205 90 75 4 47 1 828 575 216
management,
supervisors,
foremen and
superintendents
Semi-skilled and
discretionary 89 102 1 19 66 31 1 5 314 290 103
decision-making
Unskilled and
defined decision- 51 43 5 6 39 4 2 2 152 144 47
making
TOTAL
450 429 35 341 254 130 12 71 13 2 1 737 1 310 467
PERMANENT
Temporary
28 33 23 8 4 1 2 – – 99 74 15
employees
GRAND TOTAL 478 462 35 364 262 134 13 73 13 2 1 836 1 384 482
SKILLS DEVELOPMENT
PetroSA reviews the skills levels within the organisation on
an annual basis in order to align training and development
needs with its employment equity plan. Ongoing training
and development opportunities were afforded to employees
through various training institutions. R35.9 million was
spent on training and development including travel and
accommodation, in the period under review. The following
skills development initiatives were advanced:
Study Assistance for Permanent Employees

The PetroSA Study Assistance programme continued to
financially support the company’s employees towards
studies that are aimed at increasing their competence in the
R36 million
job and invariably their prospects for career growth. The
study assistance programme is open to all the company’s
employees for part-time tertiary studies. This ranges from
postgraduate studies in engineering, commerce, law and
various other fields of interest at any level, including starting
employee training and
from first year. development
Leadership in Oil and Energy
The Leadership in Oil and Energy Certificate programme
offered by Wits Business School through SAPIA is aimed at
developing women leadership skills within the petroleum
industry. To date 30 PetroSA employees successfully David Maripane, PetroSA’s
completed the programme, with seven employees completing
the programme during 2010. intellectual property
High Performance Culture Academy
manager, is not shy to
The High Performance Culture programme played an important acknowledge the company’s
role in developing the functional management competencies generous support to him
needed within the organisation. The programme also served to
increase awareness of the importance of sound management
while he qualified as one
and leadership practices for business. The programme of the few black patent
consisted of a supervisory and management development
programme, with 16 employees completing the programme
attorneys in South Africa. “It’s
during the reporting period. This brought the number of payback time,” he says. “Now
PetroSA employees that have completed the programme to 57 that I am qualified, we at
over the three years of its existence.
PetroSA can register patents
Graduate-in-Training and In-service Training on our own.”
During the reporting period a total number of 23 graduates
joined PetroSA from several of its student development
programmes. These graduates were given a two-year fixed-
term contract within the various business areas, where they
will be mentored by skilled professionals depending on their
career of choice. The breakdown of the intake is as follows:
• Graduates-in-Training = 13
• Experiential learners = 10
Bursaries
Bursaries are offered to South African students from
previously disadvantaged communities to complete
undergraduate studies at South African tertiary institutions.
For the financial year 2010/2011 PetroSA’s bursary
programme consisted of a total number of 91 full-time The PetroSA Centre of
students in primarily the various fields of engineering, Excellence attempts to
geosciences and commerce. For 2010/2011 there were
no new intakes into the programme, with the objective address much-needed
of lowering the number and also with 13 of the students industry skills while
having graduated and being accommodated into the
Graduate-in-Training programme.
assisting the country to
Centre of Excellence
develop the skills needed.
The PetroSA Centre of Excellence (COE) in Mossel Bay is
In ten years, it has:
accredited by the Chemical Industry and Energy Training • qualified 732 learners
Authority (CHIETA) to provide learnerships, NQF Levels • trained 420 safety
2 – 4, and qualifications in the National Trade Test for
electricians, instrument mechanics, fitters, riggers, welders watchers
and boilermakers. • trained 258 mechanical
For the period under review the COE had an intake of 42 operators
new learners. This increased the total enrolment at the COE
to 172 learners. Established in 2002, the COE qualified
• trained 504 floggers
more than 732 learners to date. The COE has also trained
about 420 safety watchers, 258 mechanical operators and
504 floggers. These skills are primarily used by the industry
during their statutory shut-downs.

TRANSFORMING THE COMPANY, THE SECTOR AND SOCIETY (CONTINUED)
Also, a total of 49 candidates were assessed and qualified

using the Recognition of Prior Learning (RPL) process.
PetroSA’s efforts at the Centre of Excellence will go a long
way in addressing the much-needed industry skills while
assisting the country in its efforts to develop the skills so
needed by its developing economy.
BBBEE sales
PREFERENTIAL PROCUREMENT SIGNIFICANTLY
INCREASED 61%
Our support for BBBEE paid off, with our BEE volumes of commercial
increasing in the period under review.
business
BBBEE Product Sales More than Half of
Commercial Business Sales Volumes
sales volume
Through commercial and industrial business-to-business sales
and marketing activities, the company continued to advance
transformation by supporting BBBEE companies. PetroSA’s
efforts in securing hospitality supply agreements with the
major oil companies have boosted our ability to supply
BBBEE companies. BBBEE sales accounted for 61% of the
commercial business sales volume in the period under review.
21%
BBBEE Sales as at 31 March 2011
The table below depicts BBBEE sales in volume terms (m3) as a
percentage of total commercial business sales.
9%
53%
Total
BBBEE Non-BBBEE commercial %
sales sales business BBBEE
8%
Main fuels 71 571 70 064 141 635 51%
Specialties 140 759 67 084 207 846 68% 9%
Total 212 330 137 148 349 478 61%
The actual sales to BBBEE companies increased by 14%,

Local fuels
from 186 million litres in 2009/10 to 212 million litres
Imports
in 2010/2011. PetroSA has made further inroads in
implementing improved pricing structures for our BBBEE Crude oil
customers. By leveraging the company’s own production from Petrochemicals

the GTL refinery, the company has been able to offer our BEE fuels
BBBEE customers discounts, while not eroding value.
BBBEE sales volumes for 2010/2011 were 9.2% of total
Ytd Ytd %
PetroSA sales. 2010/11 import Ytd BEE BEE
Trading Budget volume volume volume
Transactions with BBBEE suppliers for the procurement of
Purchases (mt) (mt) (mt) (mt)
feedstock and finished products also increased considerably
from 21% in 2009/2010 to 39% in 2010/2011 of total Finished
volumes purchased, as the table shows: product 295 022 389 479 220 832 57%
Toluene/
Reformate 92 920 74 697 0 0%
Condensate 197 620 121 785 9 113 7%
Total 585 562 585 962 229 945 39%

ENTERPRISE DEVELOPMENT STRATEGY
REVISITED
The company’s enterprise development programme focused
on four enterprises to be developed in the initial period up
to December 2011 to ensure they are sustainable. These
companies provide services to PetroSA in the areas of
scaffolding, painting, insulation, fabrication and fire-fighting.
This has meant that no new companies could be recruited into
the programme until the four initial companies completed their
development tenure. This approach impacted negatively on the
company’s BBBEE rating.
A new strategy was formulated to address this shortcoming
and culminated in a competitive supplier development
programme which has been submitted to the shareholder
ministry (Department of Energy) for approval.
FINALISATION OF GROUP MANAGEMENT

FRAMEWORK PROJECT
The development phase of the Group Management Framework
project, which began in 2008, was completed in September 2010.
The main deliverables were:
• a governance guide that details how PetroSA will operate in
all its jurisdictions;
• an integrated business process system aimed at yielding
best-practice processes for the company; and
• change management and branding.
The project culminated in a business practice model which began
rolling out in November 2010 and will run for 24 months, overseen
by a specialised committee.

ENSURING SAFETY, HEALTH, ENVIRONMENT AND QUALITY
PetroSA is committed to promoting world-class safety standards,

practices and a culture that ensures the health and safety of
employees and all those who may be affected by the company’s
operations. The company safeguards the environment and
reduces the environmental impacts in areas where it operates,
while ensuring that products and services meet internationally
recognised quality standards.

Health and Safety Well Managed with No
Fatalities
In the period under review, there were no fatalities, while
15 disabling injuries (non-permanent) were recorded. This
translates to a disabling injury frequency rate of 0.39, against
a target of less than 0.4.
A quantitative risk assessment for the GTL refinery
was finalised and a plan to resolve the process safety
management gaps that were identified, was put in place.
Quality Reaffirmed with Recertification of

ISO 9001
The South African Bureau of Standards conducted audits
at the GTL refinery in Mossel Bay and at head office in
Parow in October 2010. The audits were performed as part
of the bureau’s surveillance programme to ascertain the
company’s maintenance and continued compliance with the
requirements of ISO 9001. These audits confirmed that the
company retains its certification in the year under review.
Compliance with Health and Safety

Legislation and Other Measures
The Inspectorate from the Department of Mineral Resources
continues to visit PetroSA to assess compliance with the Mine
Health and Safety Act. The inspectorate visits covered health
and machinery audits and no major findings were noted. The
Lloyds Register Certificate of Fitness was retained for the
F-A Platform, with 97% compliance achieved.
The ORCA oil production facility and F-A Platform also went
through a SAMSA oil pollution safety certificate audit and
the certificate was retained. A national key point assessment
audit was conducted and no major findings were noted.
environmental studies were conducted for the GTL landfill and
Moreover, the GTL refinery’s annual national key point
for the offshore production infrastructure to provide a risk-
emergency exercise was successfully conducted.
based environmentally sound basis for liability provision.
An Integrated Health, Safety and
Three Environmental Incidents Occurred
Environmental Policy to be Drafted
With respect to environmental incidents, defined as a high-
We have reviewed the company’s health, safety and
impact incident that threatens the company’s operating
environmental policies with a view to creating an integrated
health, safety and environmental policy. licence and permits and may result in evacuation of
employees and local communities, three incidents occurred in
Environmental Programme Reports Aligned the period under review.
with best Practice and Legislation
The first incident occurred in July 2010 when effluent
PetroSA continues to work at improving its environmental
that did not comply with discharge permit conditions
management system and ensure that it is integrated with
was released to the sea. The incident was related to the
the safety, health and quality systems and with other key
ongoing and severe problems associated with the anaerobic
business processes.
digesters at the GTL plant. The two other incidents occurred
A key focus for the year was the updating of the in February 2011, at the Voorbaai tankfarm, where diesel
environmental management programme reports for entered the storm water system and discharged onto the
exploration in Block 9, bringing the reports in line with beach adjacent to the tankfarm.
international practice and current legislation. A similar
process was initiated for the GTL refinery and this work will Compliance with Environmental Regulations
be completed in the next financial year. The emphasis of and Incident Reporting
these updated reports is on performance monitoring and The Environmental Management Inspectorate of the
measurement, rather than simply compliance. Department of Environment Affairs made its quarterly visits to
Considerable effort was also directed at the environmental PetroSA to assess compliance and review incident reports as
liability associated with closure or abandonment. Two techno- part of the national strategic compliance project for refineries.

SIGNIFICANT CONTRIBUTIONS TO CORPORATE SOCIAL INVESTMENT
The company remains

committed to transforming
Corporate social society at large through our
investment spend corporate social investment
programme. This year, the
R30 million company invested R30 million
on various educational and
R200 million
community development
initiatives. We have spent over
in last five years R200 million in the past five
years.
Anglican Archbishop, Njongonkulu Ndungane, who heads

up the Historic Schools Restoration Project, praised the
company: “PetroSA operates a dynamic corporate social
investment programme that focuses on funding upliftment
initiatives in the areas of health, education, the environment
and community development.”

PetroSA was the first South African company to contribute
to the restoration of the 155-year-old Healdtown Comprehensive
High School.
Contributing to Restoring the Historic Healdtown Comprehensive High School

PetroSA donated R2.125 million to restore Healdtown Comprehensive High School. The project falls under the auspices of the
Historic Schools Restoration Project, which refurbishes historically significant secondary institutions of learning to their former
status. The school had fallen into a state of disrepair and neglect, resulting in damaged buildings and infrastructure. Healdtown
has been an incubator of African intellectual excellence since 1855. The school produced several prominent leaders, including
former President Nelson Mandela and John Tengo Jabavu, a leading intellectual who became editor of Imvo Zabantsundu, the
first African-language newspaper in 1884. Other prominent alumni of the school include Robert Sobukwe, the founder of the
Pan-Africanist Congress; the Rivonia trialists, Govan Mbeki and Raymond Mhlaba; and the Rev. Seth Mokitimi, the first black
president of the Methodist Church of Southern Africa.
The funding we provided will contribute towards the construction of a state-of-the-art computer laboratory, a science laboratory,
ablution facilities and the general refurbishment of the school facilities.

Bringing Education Closer to the People with
Masiphathisane Combined School
PetroSA contributed R15.5 million and the Western
Cape Department of Education R6.4 million to build a
state-of-the-art school to help alleviate the educational
infrastructure challenges in Vredenburg, Saldanha. Prior to
this intervention, Vredenburg’s Louwville and Chris Hani
townships did not have a school and learners had to walk
long distances to overcrowded schools.
The new Masiphathisane Primary has over 800 learners in
grades R to 9 and boasts a communication and media centre,
a computer laboratory, a sickroom, two store rooms, a
library, paraplegic ramps and toilets, a furnished school hall,
a netball court and a fully equipped feeding scheme kitchen.
During construction, about 170 Vredenburg community
members were employed at the school.

South African Youth Choir Performs at alleviation on World AIDS Day, 1 December 2010. In about
FIFA World Cup two hours, 6 400 parcels were packed and ready to go to the
following organisations:
PetroSA has been funding the South African Youth Choir for the
last four years to a cumulative R8 million. The year 2010 was • Fikelela, the Anglican Diocesan AIDS Foundation, for
an exciting one for the choir as they were invited to perform at distribution to AIDS sufferers in Khayelitsha and other centres;
the momentous World Cup festivities in the City of Cape Town,
• The Langa AIDS Action Group, for distribution primarily to
affording PetroSA media publicity locally and internationally.
children affected by AIDS, and particularly child-headed
By funding these students, the company hopes to rid these homes. This included Christmas gifts for these children; and
young people of financial worries about tuition and boarding, • Lily Haven Old Age Home in Bonteheuwel. The home also
enabling them to reach their full potential by concentrating on received three months’ supply of disposable diapers for
their studies while developing their singing talent. its residents. PetroSA employees visited the home carrying
toiletry hampers addressed to grandpa or grandma, which
were gratefully received by around 150 men and women
who are often forgotten at this special time of year.
Donation to Mossel Bay Marine Life Project

Enables Research into Sharks
The company donated R50 000 to Oceans Research team to
track the movements of three sharks in the Mossel Bay area for
a total of 319 hours last year. In June 2010, the research team
broke the world record for the longest continuous manual track
of a white shark by following her for 106 hours straight.
The project also enabled an estimate of the white shark

population in this region by making it possible for team
members to take daily trips into the bay for dorsal fin photo-
Packing Parcels for Needy Young and Old at identification to generate this vital data. This research also
Christmas with Stop Hunger Now empowered young minds as its findings were shared with
the local schools.
PetroSA donated R100 000 to the Western Cape branch
of Stop Hunger Now to assist with setting up offices in The research was featured in the National Geographic
Cape Town. In addition, our enthusiastic employees worked documentary, Dangerous Encounters with Brady Barr.
with the organisation to pack food parcels for non- Our contribution will give PetroSA international repeated
governmental organisations involved in hunger and poverty exposure for the next five years that the programme will run.

ANNUAL FINANCIAL STATEMENTS
GENERAL INFORMATION
Country of incorporation and domicile South Africa
Nature of business and principal activities Exploration for and production of oil and gas, refining
operations converting gas and gas condensate to liquid fuels
and petrochemicals and the marketing thereof
Directors Adv. L Makatini

Mr N Nika
Mr MB Damane
Mr DR Zihlangu
Dr ZR Rustomjee
Mr Z Mavuso
Mr YR Tenza
Ms N Medupe
Dr AMB Mokaba
Mr ACG Molusi
Ms GN Jiyane
Ms FE Letlape
Mr MM Zwane
Registered office 151 Frans Conradie Drive

Parow
7500
Postal address Private Bag X5

Parow
7499
Holding company CEF (Proprietary) Limited

incorporated in South Africa
Auditors Auditor-General of South Africa
Secretary Adv. PSV Ngaba
Company registration number 1970/008130/07

CONTENTS
The reports and statements set out below comprise the annual report presented to the shareholders:
Page
Report of the Auditor-General 48
Directors’ Responsibilities and Approval 50
Statement on Corporate Governance 51
Performance Against Objectives 56
Value Added Statement 60
Directors’ Report 61
Report of the Board Audit Committee 68
Materiality and Significant Framework 69
Statement from Company Secretary 72
Statement of Financial Position 74
Statement of Comprehensive Income 75
Statement of Changes in Equity 76
Statement of Cash Flows 77
Accounting Policies 78
Notes to the Annual Financial Statements 90
The following supplementary information does not form part of the annual financial statements and is unaudited:
Fields in Production and Under Development 131
Definition of Financial Terms 133
World Cup Expenditure Inside Back Cover

REPORT OF THE AUDITOR-GENERAL TO PARLIAMENT
on the financial statements of the Petroleum Oil and Gas Corporation of South Africa (Pty) Limited
for the year ended 31 March 2011
REPORT ON THE CONSOLIDATED of material misstatement of the consolidated and

separate financial statements, whether due to
FINANCIAL STATEMENTS fraud or error. In making those risk assessments,
Introduction the auditor considers internal controls relevant to
I have audited the accompanying consolidated and the entity’s preparation and fair presentation of the
separate financial statements of the Petroleum Oil and consolidated and separate financial statements in
Gas Corporation of South Africa (Pty) Limited (PetroSA), order to design audit procedures that are appropriate
which comprise the consolidated and separate statement in the circumstances, but not for the purpose of
of financial position as at 31 March 2011, and the expressing an opinion on the effectiveness of the
consolidated and separate statement of comprehensive entity’s internal control. An audit also includes
income, statement of changes in equity and statement evaluating the appropriateness of accounting policies
of cash flows for the year then ended, and a summary used and the reasonableness of accounting estimates
of significant accounting policies and other explanatory made by management, as well as evaluating the
information, and the accounting authority’s report as set overall presentation of the consolidated and separate
out on pages 61 to 130. financial statements.
Accounting Authority’s Responsibility for I believe that the audit evidence I have obtained is
the Financial Statements sufficient and appropriate to provide a basis for my
audit opinion.
The Board of Directors, which constitute the
accounting authority, is responsible for the preparation Opinion
and fair presentation of these consolidated and In my opinion, the consolidated and separate
separate financial statements in accordance with financial statements present fairly, in all material
South African Statements of Generally Accepted respects, the financial position of PetroSA as at
Accounting Practice (SA Statements of GAAP) and 31 March 2011, and its financial performance and
the requirements of the Public Finance Management cash flows for the year then ended in accordance
Act of South Africa No. 1 of 1999 (PFMA) and the with SA Statements of GAAP and the requirements of
Companies Act of South Africa No. 61 of 1973 and the PFMA and the Companies Act of South Africa.
for such internal control as management determines
necessary to enable the preparation of consolidated Emphasis of Matter
and separate financial statements that are free from I draw attention to the matter below. My opinion is
material misstatement, whether due to fraud or error. not modified in respect of this matter:
Auditor-General’s Responsibility Significant Uncertainties
As required by section 188 of the Constitution of the With reference to note 9 in the Directors’ Report of
Republic of South Africa No. 108 of 1996 and the financial statements, the Company has disposed
section 4 of the Public Audit Act of South Africa of Brass Exploration Unlimited during the financial
No. 25 of 2004 (PAA) and section 1E3 of the Central year. As this disposal is currently the subject of
Energy Fund Act of South Africa No. 38 of 1977, as litigation, the balances and transactions of this entity
amended, my responsibility is to express an opinion on continue to be consolidated as at period-end.
these consolidated and separate financial statements
Material Impairments
based on my audit.
As disclosed in note 8 to the financial statements,
I conducted my audit in accordance with material impairments to an intercompany loan account
International Standards on Auditing and General to the amount of R945 million was incurred due to its
Notice 1111 of 2010, issued in Government Gazette recoverability being doubtful. The loan amounting to
33872 of 15 December 2010. Those standards R270 million to PetroSA Gryphon Marin from PetroSA
require that I comply with ethical requirements and was written off as at 31 March 2011.
plan and perform the audit to obtain reasonable
assurance about whether the consolidated and Additional Matter
separate financial statements are free from material I draw attention to the matter below. My opinion is
misstatement. not modified in respect of this matter:
An audit involves performing procedures to obtain The “Value Added Statement”, “Fields in Production
audit evidence about the amounts and disclosures in and Under Development” schedule and the
the consolidated and separate financial statements. “Definition of Financial Terms” list, set out on
The procedures selected depend on the auditor’s page 60, pages 131 to 132 and pages133 to 136
judgement, including the assessment of the risks respectively of the financial statements, does not

form part of the financial statements and is presented INTERNAL CONTROL
as additional information. I have not audited these
In accordance with the PAA and in terms of General
schedules and accordingly I do not express an opinion
Notice 1111 of 2010, issued in Government Gazette
thereon.
33872 of 15 December 2010, I considered internal
control relevant to my audit, but not for the purpose
REPORT ON OTHER LEGAL AND of expressing an opinion on the effectiveness of
REGULATORY REQUIREMENTS internal control. The matters reported below are
In accordance with the PAA and in terms of General limited to the significant deficiencies that resulted in
Notice 1111 of 2010, issued in Government Gazette the findings on compliance with laws and regulations
33872 of 15 December 2010, I include below my included in this report.
findings on the annual performance report as set out
Leadership
on pages 56 to 59 and material non-compliance with
The non-compliance matters noted in respect of
laws and regulations applicable to the Company.
compliance with laws and regulations are due to
Predetermined Objectives the leadership of the Company not overseeing
There were no material findings on the annual management’s actions to address the matters
performance report concerning the presentation, identified and assessing whether management’s
usefulness and reliability of the information. actions are effective.
Compliance with Laws and Regulations Financial and Performance Management

Included below are findings on material non- The financial statements submitted for audit were
compliance with laws and regulations applicable to subject to material corrections as a result of:
the Schedule 2 public entity. • company processes not being completed at the
National Environmental Management Act time of submission of the financial statements;
There is a contravention of the “duty of care” • applying the incorrect accounting treatement as a
principle as envisaged in section 28(1) as well as result of acting on incomplete information; and
section 28(14) and (15) of the National Environmental
Management Act No.107 of 1998 (NEMA), as timely • a lapse in the oversight responsibilities over the
corrective action has not been implemented with processing of material journal entries.
regards to the sub-surface contamination at the
Voorbaai terminal. In this regard the effectiveness of OTHER REPORTS
the environmental management system, particularly Agreed-upon Procedures Engagement
in respect of monitoring has been identified as a key As requested by the accounting authority, an
weakness in managing compliance risk. engagement was conducted during the year under
Expenditure Management review concerning the accuracy of the IP tracer levy. The
The accounting authority did not take effective and reports covered the period April 2010 to March 2011.
appropriate steps to prevent irregular and fruitless
and wasteful expenditure, as per the requirements
of section 51(1)(b)(ii) of the PFMA and as disclosed
in the Directors’ Report (note 7) and note 39 in the
consolidated annual financial statements.
Pretoria
Annual Financial Statements
31 July 2011
The financial statements submitted for audit did not
comply with section 55(1)(c)(i) of the PFMA. The
following material misstatements were identified
during the audit; these were subsequently corrected
by management.
• A provision at year-end was not included in the
annual financial statements presented for audit.
• A subsidiary had not been consolidated in the
Group annual financial statements.
• A journal has been passed using an incorrect currency.

DIRECTORS’ RESPONSIBILITIES AND APPROVAL
The report is presented in terms of the Public Generally Accepted Accounting Practice (GAAP),
Finance Management Act No. 1 of 1999 (PFMA), including any interpretations of such Statements
as amended, and is focused on the financial results issued by the Accounting Practices Board, and the
and financial position of the Company information Companies Act, together with the Corporate Laws
pertaining to the Company’s state of affairs. Its Amendment Act. The annual financial statements are
business operations and performance against based on appropriate accounting policies consistently
predetermined objectives are disclosed elsewhere in applied and supported by reasonable and prudent
the annual report. judgements and estimates.
The directors acknowledge their responsibility for the The directors have no reason to believe that the
preparation, integrity and fair presentation of the Company will not be a going concern in the
annual financial statements and related information foreseeable future based on forecasts, available cash
included in the annual report. In order for the resources and ongoing support from the holding
directors to discharge these responsibilities, as well as company and has, for this reason, adopted the going
those bestowed on them in terms of the PFMA and concern basis in preparing the financial statements.
other applicable legislation, they have developed and
The annual financial statements have been audited by
maintain a system of internal control.
the Auditor-General who was given unrestricted access
Internal controls include a risk-based system of internal to all financial records and related data, including
accounting and administrative controls designed to minutes of all meetings of the shareholders, the Board
provide reasonable, but not absolute, assurance that of Directors and management. The directors believe
assets are safeguarded and that transactions are that all representations made to the independent
executed and recorded in accordance with generally auditors during their audit were valid and appropriate.
accepted business practice, as well as policies The Auditor-General’s report is attached.
and procedures established by the directors and
The annual financial statements for the year ended
independent oversight by the Board Audit Committee.
31 March 2011, which appear on pages 61 to 130,
The annual financial statements have been prepared were approved by the Board of Directors on
in accordance with South African Statements of 20 July 2011 and were signed on its behalf by:
Dr AMB Mokaba Mr N Nika

Cape Town
20 July 2011

STATEMENT ON CORPORATE GOVERNANCE
1. INTRODUCTION for the operation of the PetroSA Group’s activities

and details on how the Group will operate in all
PetroSA embraces the principles of good corporate
its jurisdictions globally. The manual summarises
governance as outlined in the King Reports and
the governing principles in terms of which PetroSA
Protocol on Corporate Governance in the Public
operates; sets out the roles and responsibilities of the
Sector. This is to ensure that an ethical foundation
exists which promotes responsibility, accountability, PetroSA governance structures, e.g. Board and Board
fairness and transparency. To achieve these, the Committees; provides an overview of the governance
Group has a formalised system of corporate operations, e.g. Board meetings; and provides an
governance which is a catalyst for improved overview of the PetroSA Group assurance activities.
compliance and enhanced performance.
2. GOVERNING BODIES
The Company continuously strives to uphold these tenets
of governance and for the financial year 2010/2011, the
Boards of Directors
development of a framework in preparation towards In accordance with the Public Finance Management Act
the implementation of the King III Code and the new No. 1 of 1999 the Board is the accounting authority
Companies Act No. 71 of 2008 (which became effective of PetroSA. The Group has a unitary Board structure
1 May 2011), was initiated. The Board and Management made up of a majority of non-executive directors,
have attended various presentations on King III and the appointed by the shareholder. The Board retains overall
new Companies Act to gain a better understanding of accountability for the running of the Company and
the imminent legislative landscape. reserves, for itself, decisions on matters that could
have a material impact on the business. To that end,
These efforts include the following key developments
Executive Management is charged with the day to day
initiated within the Company during the financial
running of the business, with the Board addressing a
year under review:
range of key issues to ensure that it retains the strategic
• implementation of action plans emanating from a direction of, and proper control over, the Group. The
high-level governance audit conducted to identify non-executive directors are appointed on a three-year
possible gaps within the Company in relation to cycle and reappointment is not automatic. The Board
King lll and the new Companies Act; meets at least once every quarter. The Board met eleven
• revision of the current memorandum and articles times during the period under review.
of association with the view of amending the The Board’s primary responsibilities include the
memorandum of incorporation as envisaged in the appointment of the CEO, giving strategic direction to
Companies Act of 2008; the Company, ensuring that policies and procedures
• revision of policies, terms of references and are in place, monitoring the performance of the
procedures to align them to the new governance Company against agreed objectives, identifying
framework; key performance and risk areas, providing effective
leadership on an ethical foundation, ensuring
• revision of the Board Charter to align it with King III that there is an effective risk-based Internal Audit
and other amendments in the legislative framework; function, defining levels of materiality, reserving
• evaluation of the performance of PetroSA’s Board specific powers to itself and delegating other matters,
of Directors; with the necessary written authority, to the CEO,
ensuring that timelines for submission of reports in
• review and update of code of ethics;
compliance with the PFMA are adhered to, including
• review of the PetroSA’s levels of authority matrix; submission of financial statements, and ensuring that
annually a shareholder’s compact is concluded with
• a comprehensive induction programme for newly-
the shareholder in respect of agreed performance
appointed directors which includes presentations on
indicators for the Company in the next year.
King III and the new Companies Act of 2008; and
• ensuring that Board members are continuously Company Secretary
exposed to training on governance and The Company Secretary is responsible for ensuring that
developments within the industry and legislative the Company’s affairs as well as the Board proceedings
landscape at cost to the Company. are properly carried out in accordance with the
relevant laws and standards.
The process of formalising and documenting
governance processes and structures which She is also responsible to provide the Board of
culminated in a PetroSA Governance Manual, is in Directors with guidance as to how they should
the final stage, pending Board approval. This manual properly discharge their duties and responsibilities in
provides a comprehensive set of high-level guidelines the best interest of the Company.

STATEMENT ON CORPORATE GOVERNANCE (CONTINUED)
2. GOVERNING BODIES (CONTINUED) Risk Management and Compliance

Each of the directors has unrestricted access to Committee (RMCC)
the advice and services of the Company Secretarial Governance of Risk Management
team, Company information, and is entitled to seek The PetroSA Board of Directors (the Board) is charged
independent professional advice, at the Company’s
with ensuring that the Company has and maintains
expense, in pursuance of their duties as director.
an effective, efficient and transparent system of
Board Committees financial and risk management and internal controls.
The Board established several committees in order to The Board remains accountable but has delegated its
assist it in the discharge of its duties. All committees risk management function to the Risk Management
operate under Board-approved terms of reference, and Compliance Committee (RMCC).
which may be updated from time to time to align with
The RMCC is a properly-constituted committee
the latest developments in corporate governance. Each
consisting of only non-executive directors and
committee operates within these defined terms of
chaired by a non-executive director. It is dedicated
reference and is chaired by a non-executive director.
to reviewing and optimising risk within the Group.
Board Audit Committee (BAC) It also has a delegated responsibility to ensure
The Board Audit Committee comprises non-executive implementation and maintenance of the risk
directors appointed by the Board of Directors and management policy throughout the PetroSA Group.
meets at least four times per annum. The committee
The RMCC assumes overall Group responsibility for
is chaired by an independent non-executive director
monitoring adherence to the risk management policy
who is not the Chairman of the Board.
and risk management performance and for providing
The Board Audit Committee function is shared across a high-level risk assessment to the Board of Directors
all the subsidiaries under the ownership control of on an ongoing basis.
the PetroSA Group and is responsible for ensuring
the integrity of financial reporting and monitoring the Group Responsibility for Risk Management
adequacy and effectiveness of the governance, risk Enterprise wide risk management
management and control processes of the Group. The Risk Management and Compliance function
The Board Audit Committee is responsible for is a department that reports to the President
overseeing the Internal Audit function and the and CEO and RMCC on all risk and compliance
external audit process. The External Auditor and matters. The primary role of the risk function is to
Chief Internal Auditor have unrestricted access to the design, implement and monitor the process of risk
committee and attend all Board Audit Committee management and its integration into the day to day
meetings. activities of the Company. The Group is working on
providing combined assurance on enterprise wide risk
The Chief Executive Officer and Chief Financial
management to ensure a broad coverage of risks by
Officer are permanent invitees to the Board Audit
Committee meetings. Other executive managers different parties in the organisation. This assurance will
are invited to the committee meetings when provide more comfort to the Board moving forward.
appropriate. PetroSA’s philosophy on enterprise wide risk
Board Human Capital Committee (HCC) management is that of proactive management of
risks whilst exploiting any related opportunities
This committee is chaired by a non-executive director
and comprises non-executive directors appointed by that could present themselves as risks. To this end,
the Board. The President and CEO and the Vice- the Risk Management and Compliance department
president: Human Capital attend the committee under the guidance of the President and CEO has
meetings by invitation. This committee reviews put in place a number of governance structures and
and recommends annual remuneration increases, documents and these are subject to annual reviews
terms and conditions of employment, the payment to ensure alignment with best practices. These
of incentives and bonuses, general fringe benefits, documents are served before both Exco and the
human capital related policies and the appointment Board and approved by them respectively. The current
of senior staff at an executive level. governance policies in place include:

2. GOVERNING BODIES (CONTINUED) Through the compliance department, the recording
• Group compliance policy; of non-compliance company wide, using the
materiality levels (quantitative and qualitative) defined
• enterprise wide risk management policy; in the Group compliance policy, is an initiative
• business continuity management policy; designed to provide Exco and the Board with the
status of issues of compliance and non-compliance.
• fraud prevention policy;
In order to enable this function the Board has
• gift register procedure and declarations of related approved a Group Compliance policy.
party interests; and
PetroSA has developed compliance procedures to
• code of ethics. ensure that every employee and every stakeholder
Some of these governing policies and structures in the compliance function are fully aware of
have been supplemented with work procedures, their responsibilities within the compliance risk
practice frameworks and terms of references. Risks are management framework. As part of inculcating the
continuously identified throughout the organisation, culture of compliance within the Group, the Executive
including mitigation strategies and, where appropriate, Management signs off a management representation
management action plans. This process is rolled into the letter to the CEO and the Board declaring and attesting
development of a corporate strategic risk register that is to either issues of conflict of interest or absence thereof,
dynamic in nature and reviewed quarterly by Exco, RMCC compliance to laws, policies and procedures, and
and the Board. pronounce that they have applied risk management
techniques in the discharge of their duties.
In line with integrating and embedding a culture of
enterprise wide risk management, risk management As a principle, PetroSA does not tolerate non-
plays a pivotal role and informs key decisions taken by compliance with laws, regulations and any of its
management and the Board. own standards. The Group is working on providing
combined assurance on compliance to the Board
Fraud risk management going forward.
The Company is committed to the eradication of
Business Continuity Management as a discipline,
fraud, corruption, misconduct and any irregularities.
within the compliance function, maintains a
The fraud prevention policy addresses fraud risk
collection of plans readily accessible and available for
management from both proactive and reactive parts.
use in the event of a disaster or major disruptions to
The Group has outsourced its whistle blower hotline, business activities. These plans are empowered by an
which in the last financial year was kept available approved Business Continuity Management policy.
to staff, various stakeholders and members of the This policy requires that all business continuity plans
public. All reported cases are treated with the utmost across the organisation be kept in ready mode for
confidentiality to protect the rights of both the execution and be updated, at a minimum, yearly or
whistle blower and the alleged party. as and when material changes to business processes
Compliance risk management occur. PetroSA maintains Business Continuity Plans
for all of its locations and business critical processes.
The PetroSA Board of Directors is accountable
These plans were all updated and tested for their
for ensuring that there is compliance with laws,
relevance and ability to mitigate scenarios described
regulations, policies and procedures, and any adopted
in the plans and strategy. The Compliance function
standards applicable to the Company. The function
through training and awareness ensured their
of compliance has been delegated throughout the
continued relevance through allocation of these plans
Company based on specialist areas. In addition, the
to different role players in the Company.
Group compliance function is charged with assisting
management to discharge its responsibility to comply Quarterly Group Compliance Reports are tabled
with statutory, regulatory and supervisory requirements to Exco and the Board in which key risks, major
by facilitating the development, establishment and developments and issues and compliance incidents
maintenance of an efficient and effective compliance are brought to their attention in line with the defined
risk management process. materiality levels.

STATEMENT ON CORPORATE GOVERNANCE (CONTINUED)
Business Performance and Strategy The purpose of the BPSC is to ensure that the Company
Committee (BPSC) processes are aligned with the overall vision and
This committee is chaired by a non-executive director strategic direction, strategy management, business
and comprises non-executive directors appointed by management, capital investment, joint-venture
the Board. formations and performance measurement framework.
Composition of Board and Board Committees for the financial year under review
Risk
Business Management
Human Performance and
Board Audit Capital and Strategy Compliance
Committee Committee Committee Committee
Board (BAC) (HCC) (BPSC) (RMCC)
Non-executive Directors
Dr PS Molefe Chairman Member
Adv. L Makatini Acting Member
Chairman
Mr MB Damane Director Member Member
Prof. B Figaji Director Member Chairman Member
Mr DR Zihlangu Director Chairman Member
Mr MW Mkhize Director Member
Mr M Kajee Director Chairman Chairman
Ms BB Siwisa Director Member Member
Mr YR Tenza Director Member Member
Mr Z Mavuso Director
Dr ZR Rustomjee Director Member Member Member
Ms N Medupe Director Member Member
Dr AMB Mokaba Chairman
Mr ACG Molusi Director
Ms GN Jiyane Director
Ms FE Letlape Director
Mr MM Zwane Director
Executive Directors
Mr S Mkhize President Invitee Invitee Invitee Invitee
and CEO/
Director
Mr N Nika CFO/ Invitee Invitee Invitee Invitee
Director

3. DIRECTORS’ RESPONSIBILITY FOR THE 5. MANAGEMENT REPORTING
ANNUAL FINANCIAL STATEMENTS There are comprehensive management reporting
The directors of the Company are responsible for disciplines in place, which include the preparation
the Group annual financial statements and other of annual budgets by all divisions and reporting
information presented in the annual report. The thereon on a quarterly basis. The budget and capital
Auditor-General is responsible for performing an expenditure are reviewed and approved by the Board.
independent audit of the annual financial statements. Quarterly performance results and the financial status
of the Company and Group are reported against
The annual financial statements and notes thereto approved targets. Profit projections and forecasted
are prepared in accordance with South African cash flows are updated monthly, while working
Statements of Generally Accepted Accounting capital and borrowing levels are monitored on an
Practice (GAAP). Accounting policies are consistently ongoing basis.
applied except where otherwise stated, in which case
full disclosure of changes is made. Executive Management meets on a regular basis
to consider day to day issues pertaining to the
The directors believe that the Company and Group business of the Group. More formal bi-weekly
will continue as a going concern in the year ahead. meetings address issues such as feedback from the
various divisions on results achieved, and issues or
4. INTERNAL AUDIT opportunities which could impact on the Group, its
The Internal Audit activity is governed by an Internal trading activities and short-term planning.
Audit Charter which is reviewed and approved
annually by the Board Audit Committee. The Internal 6. CODE OF ETHICS
Audit function is shared across all subsidiaries under Directors and employees are required to maintain
the ownership control of the PetroSA Group. the highest ethical standards, ensuring that business
In order to provide for the independence of the practices are conducted in a manner which, in all
Internal Audit activity, the chief internal auditor reasonable circumstances, is beyond reproach. The
reports functionally to the Board Audit Committee code of ethics serves as a guide to assist the Board,
and administratively to the President and CEO. The Executive Management, staff and contractors of
chief internal auditor and internal auditors do not PetroSA in making ethical decisions and engaging in
perform any operational duties for the Group. The appropriate and lawful conduct.
chief internal auditor has unrestricted access to the PetroSA has contracted the services of an independent
President and CEO and Board Audit Committee hotline service providing for the confidential reporting
chairman. of fraud and other inappropriate behaviour. Employee
The primary objective of the Internal Audit activity breaches are dealt with in accordance with the
is to assess the adequacy and effectiveness of the disciplinary policy. In addition, directors are required to
PetroSA Group’s governance, risk management and annually declare their interests in contracts, as well as
control processes as designed and represented by directorships in other companies in accordance with
management. In order to achieve this, the Internal the Companies Act.
Audit department prepares a three-year rolling audit
plan and a flexible annual audit plan following a risk-
based approach. The Board Audit Committee reviews
the performance of the Internal Audit activity on a
quarterly basis.

PERFORMANCE AGAINST OBJECTIVES
A summary of The Petroleum Oil And Gas Corporation of South Africa (Pty) Limited Group's business performance
against objectives is contained in the table below:
Perform-
ance
Objective Key performance indicator Target Actual results
1. PEOPLE 1.1 Manage Talent
1.1.1 Employee Engagement 55% 72% Achieved
1.1.2 Implement Talent 50% Refer to note Achieved
Management Strategy implementation 1.1.2
1.2 Governance Framework
1.2.1 GMF Completion and Roll Completion of September 2010 Not achieved
Out GMF programme
by 31 July 2010
and development
of implementation
plan
2. FINANCE 2.1 Optimise Volumes
2.1.1 GTL Refinery Output 6.427 MMbbls 6.054 MMbbls Not achieved
2.1.2 Non-feedstock Production 1.198 MMbbls 1.26 MMbbls Achieved
2.2 Manage Profitability
Analysis
2.2.1 Gross Margin Percentage 23% 15% Not achieved
2.3 Managing Operating Costs
2.3.1 Actual vs Annual Budget Variance +5% 3% Not achieved
2.3.2 Actual vs Quarterly Forecast Variance ±15% 5% Achieved
3. STAKEHOLDER 3.1 Sustainable Corporate
Citizenship
3.1.1 Preferential Procurement 40% 53.4% Achieved
3.1.2 BEE Sales 5% increase 14% increase Achieved

Perform-
ance
Objective Key performance indicator Target Actual results
4. INTERNAL 4.1 Sustainable SHEQ
BUSINESS 4.1.1 Disabling Injuries (DIFR) < 0.4 0.39 Achieved
PROCESSES
4.1.2 Environmental Incidents 0 3 Not achieved
4.1.3 Fatalities 0 0 Achieved
4.2 Mossel Bay Refinery
Solution
4.2.1 Feedstock – F-O Business Case 31 July 2010 Refer to note Achieved
4.2.1
4.2.2 Concept Study Complete Refer to note Not achieved
feasibility study by 4.2.2
31 March 2011
4.3 Ensure Non-feedstock
Solution
4.3.1 Reserve Addition 10 MMbbls Refer to note Not achieved
4.3.1
4.4 Execute Infrastructure
Initiatives
4.4.1 Crude Refinery Finalise all FEED Refer to note Not achieved
contracts by 4.4.1
31 March 2011
ready for award
4.5 Secure Access to
Downstream
4.5.1 Downstream Market Entry Finalise Refer to note Not achieved
shareholder's 4.5.1
agreement ready
for approval by
31 March 2011
4.5.2 Logistics Infrastructure Finalise Logistics Refer to note Achieved
development plan 4.5.2
for Coega and
Cape Town by end
of March 2011
4.6 Technology Development
4.6.1 Finalise Corporate Business By 31 August 2010 Refer to note Not achieved
Case 4.6.1

PERFORMANCE AGAINST OBJECTIVES (CONTINUED)
1. PEOPLE 2. FINANCE
1.1 Manage Talent 2.1 Optimise Volumes
1.1.1 Employee Engagement 2.1.1 GTL Refinery Output
An engagement level of 55% was targeted. PetroSA The GTL refinery output was 6% below budget mainly
achieved an aggregated score of 72% on the employee due to lower volumes produced as a result of changes
engagement survey that was conducted in March 2011.
in the FEED composition and unplanned operational
The survey was targeted at employees who report
challenges at the plant and reduced throughput due to
directly to managers to measure employee satisfaction
lower feedstock availability.
with managers.
1.1.2 Implement Talent Management Strategy 2.1.2 Non-feedstock Production
1.1.2.1 Complete talent evolution project Non-feedstock production is mainly made up of
The talent evolution project was scoped to production from Oribi-Oryx. The actual production was
complete approximately 400 job profiles across the 5.1% above budget. This is mainly attributable to an
organisation. The job profiling project has been acid job that was done during the period under review.
successfully completed in November 2010 with
2.2 Managing Profitability Analysis
884 job profiles being completed.
2.2.1 Gross Margin Percentage
1.1.2.2 Implement Values Driven Leadership (VDL)
The gross margin percentage of 15% vs a target of
programme
23% was mainly due to:
The business was targeting 35% participation
and completion of the values driven leadership • the strength of the SA Rand against the US Dollar,
development programme (VDL) by eligible candidates which contributed to lower revenues; and
by 31 March 2011. The target group is EE occupational
levels 1 – 3 and this includes executives, senior and • lower volumes produced as a result of changes
middle management, professionals and specialists. In in the FEED composition and some operational
all, 30 employees attended an introductory session challenges at the plant.
to VDL in Mossel Bay. An additional 56 employees
2.3 Managing Operating Costs
attended a two-day workshop before the end of the
2010/2011 financial year. Additional workshops are 2.3.1 Actual Costs vs Annual Budget
scheduled for the new financial year. Operating costs were 3% below budget during the
period under review.
1.1.2.3 Roll out Talent Committees
The purpose of the Talent Committee Forums is 2.3.2 Actual vs Quarterly Forecast
to make objective, strategic decisions about the The actual total operating costs were 5% above the
sourcing, development, deployment and retention forecast.
of key talent to optimise performance and potential
and to minimise business risk. The outcome was that
3. STAKEHOLDERS
the Talent Committee structure was agreed upon
and presented to the business through conversations 3.1 SUSTAINABLE CORPORATE
in August 2010. Training of the Mancos on talent CITIZENSHIP
management was completed by end September 2010. 3.1.1 Preferential Procurement
1.2 Governance Framework For the period under review, PetroSA’s BEE
1.2.1 GMF Completion Roll out procurement expenditure of R1 368 485 298 equates
GMF will provide an approved governance manual, to 53.41% of the total discretionary procurement
brand strategy and integrated business process expenditure. This is a remarkable accomplishment for
system. The implementation plan was to be approved PetroSA given the industry charter requirements of
by the Board by 31 July 2010. 25% BEE participation across the value chain.

3.1.2 BEE Sales • Cost estimates were issued in December 2010.
The total BEE sales were 9% above target due to a • Approval for the drill rig: 2 February 2011.
new fuel supply agreement, higher demand for LPG
and propane due to power outages at the Engen and 4.2.2 Concept Study
Chevron refineries and supply problems at one of the The target is to conduct a feasibility study for the
refineries. sweet crude feedstock case for the GTL refinery by
31 March 2011. In November 2010 the project was
4. INTERNAL BUSINESS PROCESSES put on hold in order to reprioritise it.
4.1 SHEQ
4.3 Ensure Non-feedstock Solution
4.1.1 Disabling Injury Frequency Rate (DIFR)
4.3.1 Reserve Addition
The industry disabling injuries frequency rate (DIFR)
standard is 1, compared to PetroSA’s benchmark of The 10 MMbbls target for the year is in the quest to
0.4. PetroSA achieved 0.39 DIFR during the period achieve the growth levels envisaged by Vision 2020.
under review. The target was not achieved even though the Oribi-
Oryx reserves were considered.
4.1.2 Environmental Incidents
There were three environmental incidents during the 4.4 Execute Infrastructure Projects
period under review. The first two incidents, namely 4.4.1 Crude Refinery
the contamination of sand due to poor drainage The target is to finalise all FEED contracts by
of the Voorbaai tankfarm area and the overflow of
31 March 2011 but was not met due to the fact
diesel into stormwater were managed. In managing
that Project Mthombo is awaiting approval from the
the third incident, being the release of off-spec
Minister of Energy to proceed with its FEED phase.
effluent to the ocean, interim treatment measures
have been put in place to prevent a reoccurrence 4.5 Secure Access to Downstream
and to manage the effluent quality to within permit
4.5.1 Downstream Market Entry
conditions whilst a longer term measure is being
explored. The target to finalise the shareholder’s agreement and
have it ready for approval by 31 March 2011 was not
4.1.3 Fatalities met due to lack of agreement on the terms of the
There were no fatalities during the year. shareholder’s agreement.
4.2 Mossel Bay Refinery Solution 4.5.2 Logistics Infrastructure
4.2.1 Feedstock – F-O Business Case A finalised Logistics development plan for Coega and
The F-O business case was approved in 2011. The Cape Town was approved by Exco in October 2010
following milestones were achieved: and the Board in December 2010.
• ITT for pipeline, subsea facilities installation contractor 4.6 Technology Development
was issued in November and December 2010.
4.6.1 Finalise Corporate Business Case
• Long Lead items: some outstanding orders. The GTL.F1 AG business case was approved by Exco in
• F-O FEED (including drilling): 95% complete. December 2010 to continue negotiations related to a
Target date was 31 January 2011. shareholder’s exit from the joint venture.

VALUE ADDED STATEMENT
The value added statement measures performance in terms of value added by the Group through the collective
efforts of management, employees and the providers of capital. The statement shows how the value added has been
distributed to those contributing to its creation.
Group Company
2011 2010 2011 2010
R’000 R’000 R’000 R’000
Revenue 10 821 890 8 623 259 10 761 756 8 440 627
Paid to suppliers for material and services (8 526 203) (8 251 913) (8 143 021) (8 531 445)
Income from investments 859 887 971 939 974 810 1 176 522
Wealth created 3 155 574 1 343 285 3 593 545 1 085 704
Wealth distributed as follows:

Management and employees
Remuneration and benefits 991 871 954 713 975 230 940 233
Providers of capital
Dividends – – – –
Interest on borrowings net of foreign loan
revaluations 2 565 105 259 2 561 104 986
Government
Taxation (308 519) (348 634) (312 897) (349 173)
Other payments 5 715 7 952 5 715 7 952
Total distributions 691 632 719 290 670 609 703 998
Retained for reinvestment

Depreciation 1 240 014 753 258 1 238 121 751 285
Income retained in the business 1 223 928 (129 263) 1 684 815 (369 579)
3 155 574 1 343 285 3 593 545 1 085 704

DIRECTORS’ REPORT
The directors present their annual report that forms part of the audited annual financial statements for the Group for
the year ended 31 March 2011.
1. DIRECTORS
The directors of the Company during the year and to the date of this report are as follows:
Name Appointed Resigned
Adv. L Makatini Non-executive (Acting Chairman)
Dr PS Molefe Non-executive (Chairman) 31 July 2010
Mr S Mkhize Executive (President and CEO) 24 August 2010
Mr N Nika Executive (Chief Financial Officer)
Mr MB Damane Non-executive
Prof. B Figaji Non-executive 31 July 2010
Mr DR Zihlangu Non-executive
Mr M Kajee Non-executive 9 March 2011
Ms BB Siwisa Non-executive 30 June 2010
Mr MW Mkhize Non-executive 3 November 2010
Dr ZR Rustomjee Non-executive
Mr Z Mavuso Non-executive
Mr YR Tenza Non-executive
Ms N Medupe Non-executive
Dr AMB Mokaba Non-executive (Chairman) 1 March 2011
Mr ACG Molusi Non-executive 1 March 2011
Ms GN Jiyane Non-executive 1 March 2011
Ms FE Letlape Non-executive 1 March 2011
Mr MM Zwane Non-executive 1 March 2011
2010/05/04
2010/05/25
2010/07/24
2010/08/14
2010/08/20
2010/09/27
2010/10/29
2010/11/18
2010/11/19
2011/02/01
2011/02/14
2011/02/24
Attendance at meetings: 2011/03/24

Adv. L Makatini Y Y Y Y Y Y Y Y Y Y Y Y Y
Mr N Nika Y Y Y Y N N Y Y Y Y Y Y Y
Mr MB Damane Y Y Y N Y Y N Y Y N Y Y N
Mr DR Zihlangu Y Y Y Y Y Y Y Y Y Y Y Y Y
Mr M Kajee Y Y Y Y Y Y Y Y Y Y Y Y R
Dr ZR Rustomjee Y Y Y Y Y N Y Y Y Y Y Y Y
Mr Z Mavuso Y Y Y N N N Y Y Y Y Y Y Y
Mr YR Tenza Y Y Y Y Y Y Y Y Y Y Y Y Y
Ms N Medupe N Y Y N Y Y Y Y Y Y N Y N
Ms BB Siwisa N Y R R R R R R R R R R R
Dr PS Molefe Y N Y R R R R R R R R R R
Prof. B Figaji N Y Y R R R R R R R R R R
Mr S Mkhize Y Y Y Y Y R R R R R R R R
Mr MW Mkhize N N Y Y Y N Y Y N R R R R
Dr AMB Mokaba – – – – – – – – – – – – Y
Mr ACG Molusi – – – – – – – – – – – – Y
Ms GN Jiyane – – – – – – – – – – – – Y
Ms FE Letlape – – – – – – – – – – – – Y
Mr MM Zwane – – – – – – – – – – – – Y
Y = Attended meeting N = Apology received – = Not yet appointed R = Resigned from the Board

DIRECTORS’ REPORT (CONTINUED)
1. DIRECTORS (CONTINUED)
Board Audit Committee
The committee consists of the following members and invitees:
Mr M Kajee Non-executive (Chairman) Resigned 9 March 2011
Mr YR Tenza Non-executive
Ms N Medupe Non-executive
Mr N Nika Executive
Dr ZR Rustomjee Non-executive Redeployed to committee as from 27 September 2010
Mr S Mkhize Executive Resigned 24 August 2010
Prof. B Figaji Non-executive (Chairman) Resigned 31 July 2010
2010/04/26
2010/05/14
2010/07/16
2010/10/26
2011/03/09
Attendance at meetings:
Mr M Kajee Y Y Y Y Y
Mr YR Tenza Y Y Y Y Y
Ms N Medupe Y Y Y Y N
Mr N Nika Y Y Y Y Y
Mr S Mkhize Y Y Y R R
Prof. B Figaji Y Y Y R R
Dr ZR Rustomjee – – – Y Y
Due to the expiry of the terms of Board members, the Board Audit Committee, and Risk Management
and Compliance Committee were temporarily collapsed into one committee.
Board Human Capital Committee

This committee of the Board of Directors consists of the following members and invitees:
Mr DR Zihlangu Non-executive (Chairman)
Mr MB Damane Non-executive Redeployed to committee as from 27 September 2010
Adv. L Makatini Non-executive Redeployed to committee as from 27 September 2010
Ms BB Siwisa Non-executive Term expired 30 June 2010
Dr PS Molefe Non-executive Term expired 31 July 2010

2010/04/16
2010/07/23
2010/12/09
2011/02/09
Mr DR Zihlangu Y Y Y Y
Ms BB Siwisa Y R R R
Mr S Mkhize Y Y R R
Dr PS Molefe N Y R R
Mr MB Damane – – Y Y
Adv. L Makatini – – N Y
Due to the expiry of the terms of Board members, two members were temporarily redeployed to this
committee.
Board Business Performance and Strategy Committee

Mr MB Damane Non-executive
Mr DR Zihlangu Non-executive
Mr N Nika Executive
Dr ZR Rustomjee Non-executive Redeployed to Board Audit Committee
Mr MW Mkhize Non-executive (Chairman) Resigned 31 November 2010
Prof. B Figaji Non-executive (Chairman) Term expired 31 July 2010
2010/05/14
2010/05/18
2010/07/19
2010/09/26
2011/02/11
Mr MB Damane N N N Y Y
Mr DR Zihlangu Y Y Y Y Y
Mr N Nika Y Y Y N Y
Dr ZR Rustomjee Y Y Y N RE
Mr MW Mkhize Y Y Y Y R
Prof. B Figaji Y Y Y R R
Mr S Mkhize Y Y N R R
Y = Attended meeting N = Apology received RE = Redeployed – = Not yet appointed R = Resigned from the Board
Mr MW Mkhize was temporarily appointed as chairman on 27 September 2010.

1. DIRECTORS (CONTINUED)
Board Risk Management and Compliance Committee
Mr M Kajee Non-executive (Chairman) Resigned 9 March 2011
Mr N Nika Executive
Dr ZR Rustomjee Non-executive
Mr YR Tenza Non-executive Redeployed 27 September 2010
Ms N Medupe Non-executive Redeployed 27 September 2010
Prof. B Figaji Non-executive Term expired 31 July 2010
Ms BB Siwisa Non-executive Term expired 30 June 2010
2010/04/23
2010/07/16
2010/10/26
2011/03/09
Mr M Kajee Y Y Y Y
Mr N Nika Y Y Y Y
Dr ZR Rustomjee Y Y Y Y
Prof. B Figaji Y Y R R
Ms BB Siwisa Y R R R
Mr S Mkhize Y Y R R
Mr YR Tenza – – Y Y
Ms N Medupe – – Y N
Due to the expiry of the terms of Board members, the Board Audit Committee, and Risk Management
and Compliance Committee were temporarily collapsed into one committee.
2. SECRETARY
The secretary of the Company is Adv. PSV Ngaba and her business and postal addresses are as follows:
Business address 151 Frans Conradie Drive
Parow
7500
Postal address Private Bag X5
Parow
7449
3. NATURE OF BUSINESS
Activities
The main areas of activity within the Group during the year are as follows:
• to focus on projects aimed at sustaining the GTL refinery through the securing of long-term feedstock
and cash flow maximisation;

3. NATURE OF BUSINESS (CONTINUED) the prior year which was unsuccessful. The block has
been relinquished in the current year. Accordingly,
• to ensure security of supply, growth of the Group
ministerial and SARB approvals have been obtained.
and increase its share of the local market through
A decrease in expenditure in PetroSA Equatorial
the development of a crude oil refinery in Coega,
Guinea has also contributed to the positive variance
entry into the downstream market, and ensuring
compared to the prior year. A moratorium on
upstream reserves and production growth;
recruitment and the Group wide cost savings drive
• to deliver sustainable development of the economy contributed also to the decrease in operating costs.
and communities through the targeting of skills
The Group recorded a pre-tax profit of R0.5 billion for
development, the implementation of competitive
continuing operations, which reflects an increase from
supplier development programmes and the
the prior year loss of R0.76 billion. PetroSA Nigeria and
investment in social upliftment programmes, and
Brass Exploration Unlimited have been classified
investment in the social upliftment of targeted
as discontinuing operations and reflect a profit of
groups through corporate social investment
R0.02 billion (2010: R0.06 billion) net of taxation.
programmes; and
The Group statement of financial position remains
• to ensure adherence to world class environmental,
strong with total assets of R24.2 billion (2010:
safety, health and quality standards.
R21.9 billion). A cash balance of R11.8 billion (2010:
Objectives R10 billion) versus a long-term loan of nil (also zero
The key elements/objectives of PetroSA’s core in 2010) reflects the Group’s strong net cash position.
business strategy are as follows: Various options are being explored to optimise our
currently low-geared statement of financial position
• ensure security of supply of liquid fuels for the as the organisation embarks on significant capital
country; expansion programmes in the short-to-medium term.
• be a competitive, commercially viable company The increase in non-current liabilities is due to the
on a sustained basis along the value chain for the updated abandonment study that was finalised in the
petroleum, oil, gas and petrochemical sectors; current year.
• to achieve transformation on a continuous basis 5. AUTHORISED AND ISSUED SHARE

through the implementation of employment equity
and broad-based black economic empowerment CAPITAL
policies; Details of the share capital of the Company are set
out in note15 to the annual financial statements.
• operate PetroSA in line with best international
In 2010/2011, a decision was taken to close the
practices with regard to safety, product quality, the
PetroSA North America office and exit the US market
protection of the environment and health of the
and, as a result, share capital was repaid.
people employed by the Company; and
• actively contribute to macroeconomic objectives 6. DIVIDENDS
related to the fuel price to the end-user, security No dividends were declared to the shareholder during
of supply and reduction of exposure to forex the year.
requirements.
7. MATERIALITY AND SIGNIFICANT
4. REVIEW OF FINANCIAL POSITION
FRAMEWORK
Group Financial Results and Operating
A materiality and significant framework has been
Activities developed for reporting losses through criminal
Analysis and Review of Results and Financial conduct and irregular, fruitless and wasteful
Position expenditure, as well as for significant transactions
The Group achieved a net profit of R0.8 billion (2010: envisaged per section 54(2) of the PFMA that requires
loss R0.4 billion) for the year under review. Although ministerial approval. The framework was finalised
sales revenues were higher at R10.5 billion (2010: after consultation with the external auditors and has
R8 billion), cost of sales increased by 17% (R8.8 billion been formally approved by the Board.
vs R7.6 billion in 2010) mainly because of the increased
Study reimbursements paid to employees for
abandonment costs following a revised study.
textbooks, contrary to SARS Practice Note 17,
Other Group operating costs have a positive variance resulted in interest and penalties of R720 882.
(R1.9 billion vs R2.3 billion in 2010) due to the four- F-A allowances previously treated as non-taxable
well drilling campaign in PetroSA Egypt SE Warda in subsistence allowances are now being correctly

treated as taxable subsistence allowances and The companies within the Group are subsidiaries
resulted in penalties of R3 602 057. Interest and whose existence are driven by business needs.
penalties for the late payment of VAT by PetroSA
The Brass Exploration Unlimited (BEU) financial year-end
Equatorial Guinea amounted to R16 394 611.
is 31 December in accordance with Nigerian legislation,
Damage to two outboard motors, on loan from
which is not in compliance with the PFMA requirements.
a supplier, which was not insured amounted to
The Group results include the performance of BEU
R228 142. Other fruitless and wasteful expenditure
for the year ended 31 December 2010. Pursuant to a
incurred by the Group amounts to R0.67 million.
PetroSA Executive Management and Board decision, the
The country manager in PetroSA Equatorial Guinea shareholders of BEU sold their share in the company in
incurred valid expenditure outside of his levels of order to dispose of its interest in Oil Mining Lease 114
authority, to the value of R12 427 417. This expenditure (OML114). The sale and purchase agreement for the
has subsequently been condoned. BEU shares was subject to a resolutive condition that
PetroSA is investigating irregularities in its corporate PetroSA and its subsidiary, in turn, sell their respective
social investment programme. Appropriate shareholding in PetroSA Nigeria, the legal owner of
disciplinary action has been taken and governance OML114. The purchase price of the BEU and PetroSA
processes are being tightened to prevent the Nigeria shares is the indivisible amount of US$55 million.
recurrence, as well as to maximise the benefits from The BEU sale closed on 22 February 2011 subject to
such investments. the sale of PetroSA Nigeria, which is expected to close
during the 2011/2012 financial year. The purchaser will
An employee stole money amounting to R16 673 manage and operate BEU, pending the closing of the
which was recovered from the final salary payout. In PetroSA Nigeria sale, as owners without any restrictions
2010, it was reported that interest on management or limitations, in exchange for which they have provided
fees charged to subsidiaries was fruitless and wasteful PetroSA with an appropriately extensive indemnity and
expenditure of R12 874 816. Subsequently, SARS parent company guarantee. In terms of the International
has ruled to waive such interest and the money will
Financial Reporting Standards (IFRS 5) the results and
be refunded. Total expenditure recovered during the
performance of these companies have been reflected
financial year is R12.9 million.
as a discontinuing operation in the Group financial
statements.
8. HOLDING COMPANY
The Company's holding Company is CEF (Pty) Moni Pulo Limited, our joint-venture partner, is
Limited incorporated in South Africa and the ultimate contesting the disposal of BEU and have approached
shareholder is the South African Government. the Nigerian High Court to obtain relief on the
All shares held by the government in CEF are not matter. PetroSA is defending its case and is confident
transferable in terms of the Central Energy Fund Act of success in this regard.
No. 37 of 1977. PetroSA holds 100% of the shares in PetroSA
North America. Due to declining sales volumes,
9. SUBSIDIARIES AND ASSOCIATES continuing with market development in the US would
The PetroSA Group structure has remained relatively be counter productive and therefore does not warrant
stable and is mostly driven by the Company’s pursuit PetroSA to have a physical presence in the US. As a
of exploration and production opportunities in Africa result, a decision was taken to close the PetroSA
and elsewhere in line with the Company’s objectives. North America office and exit the US market.

10. SUBSEQUENT EVENTS
PetroSA has a 37.5% interest in the associate company GTL.F1 AG, a Swiss-incorporated technology company
which holds the licences of the GTL technology. The Group results include the performance of GTL.F1 AG for the
year ended 31 December 2010. One of joint-venture partners have indicated their intent to withdraw from GTL.F1
AG in the forthcoming year. This will result in PetroSA’s share increasing from 37.5% to 50%.
The directors are not aware of any other matters or circumstances arising since the end of the financial year, not
otherwise dealt with in the financial statements which significantly affect the financial position of the Company or
the results of the operations.
11. GOING CONCERN

The directors believe that the Group will continue as a going concern in the year ahead.
Dr AMB Mokaba Mr N Nika

Cape Town
20 July 2011

REPORT OF THE BOARD AUDIT COMMITTEE
The Board Audit Committee has adopted formal terms • the information and explanations provided by
of reference as its Board Audit Committee Charter and management;
has discharged all its responsibilities as set out in the
charter. • Internal Audit reports; and
• external audit reports.

1. RESPONSIBILITIES
In performing its responsibilities the Board Audit The Board Audit Committee concurs with the
Committee has reviewed the following: Auditor-General of South Africa’s opinion on the
• the annual financial statements prior to submission annual financial statements after having reviewed:
and approval by the Board;
• changes in accounting policies;
• the effectiveness of the internal control systems
including computerised information system • unaudited and audited annual financial
controls and security; statements;
• the risk areas of the Company’s operations covered • unaudited and audited performance against
in the scope of internal and external audits; predetermined objectives;
• the reliability and integrity of financial information
• the management letter issued by the Auditor-
provided by management;
General of South Africa and management’s
• accounting and auditing concerns identified as a
response thereto; and
result of internal and external audits;
• the Auditor-General’s audit of the financial • significant adjustments resulting from the audit.
statements and the reports thereon; The Board Audit Committee confirms that in
• the activities of the Internal Audit function, discharging its responsibilities it has complied with
including its effectiveness, annual work the Companies Act No. 61 of 1973, as amended and
programme, co-ordination with the external
the Public Finance Management Act No. 1 of 1999.
auditors and the responses of management to
specific recommendations;
2. LEGAL AND REGULATORY
• the Company’s compliance with legal and
regulatory provisions; COMPLIANCE
• the independence and objectivity of the chief The Board Audit Committee concurs that the
internal auditor; adoption of the going concern premise is appropriate
in preparing the annual financial statements and
• the independence and objectivity of the Auditor-
General; has recommended the adoption of the financial
statements by the Board of Directors at their meeting
• the activities of the external auditors, including
effectiveness, its annual work programme and on 11 July 2011.
planned audit fees, co-ordination with the internal
auditors, the reports of significant investigations
and the responses of management to specific
recommendations; and
• the going concern assumptions and assessment
prepared by management.
The Board Audit Committee is satisfied that generally Ms GN Jiyane
an effective system of internal controls, including Chairman
internal financial controls, has been implemented and
maintained based on: 20 July 2011

MATERIALITY AND SIGNIFICANT FRAMEWORK
The criteria for assessing the materiality and significant framework for The Petroleum Oil and Gas Corporation of
South Africa (Pty) Limited are contained in the table below:
QUALITATIVE QUANTITATIVE
1. MATERIAL DISCLOSURE OF INFORMATION TO THE MINISTER
Disclosure by the Facts that may influence the decisions or actions of Risks to the public
PetroSA Board of the stakeholders of a public entity. entity that may
material facts to the impact on the future
Minister of Minerals sustainability of the
and Energy entity or the Group
2. ANNUAL REPORT, FINANCIAL STATEMENT AND EXECUTIVE AUTHORITY DISCLOSURES
Material losses Criminal conduct: All expenditure
Expenditure that results from an illegal act,
fraudulent act and/or a criminal behaviour. All
instances will be fully disclosed to the Board Audit
Committee. Disclosures in the annual report and the
financial statements will be made for all losses due to
criminal conduct.
Irregular expenditure: All expenditure
Other than unauthorised expenditure, incurred in
contravention of or that is not in accordance with
the requirements of any applicable legislation.
Fruitless and wasteful expenditure: All expenditure
Made in vain and would have been avoided had
reasonable care been exercised.
3. BORROWINGS, GUARANTEE, INDEMNITY OR SECURITY
Borrowings, guarantees, indemnity or security must
be approved by the Board.
4. APPROVAL FROM THE ACCOUNTING AUTHORITY ON PARTICIPATION IN CERTAIN TRANSACTIONS
Significant partnership Approval from the executive authority is needed when < R467 000 000
capital at risk for PetroSA exceeds 2% of total assets.
Significant trust Approval from the executive authority is needed < R467 000 000
when funding of the trust exceeds 2% of total assets
of PetroSA.
Significant Approval from the executive authority is needed < R467 000 000
unincorporated joint when venture capital at risk for PetroSA exceeds 2%
venture of total assets.
Significant shareholding Approval from the executive authority is needed on < R467 000 000
acquisition and disposal of shareholding in a trading
company where PetroSA’s investment exceeds 2% of
total assets.
Significant assets Approval from the executive authority is needed on < R467 000 000
acquisition and disposal of any immovable property
such as land, buildings and movable assets when the
cost exceeds 2% of the total assets of PetroSA.
Significant business Approval from the executive authority is needed < R467 000 000
when commencement and cessation of a business
activity represents or will represent more than 2% of
PetroSA’s total assets.

MATERIALITY AND SIGNIFICANT FRAMEWORK (CONTINUED)
4. APPROVAL FROM THE ACCOUNTING AUTHORITY ON PARTICIPATION IN CERTAIN TRANSACTIONS
(CONTINUED)
Significant change Approval from the executive authority is < R467 000 000
needed when engaging in new business that
is unrelated to the business and where the
investment exceeds 2% of total assets.
5. APPROVAL FROM CEF BOARD ON PARTICIPATION IN CERTAIN TRANSACTIONS
Significant partnership Approval from the CEF Board is needed when R467 000 001 < R655 000 000
capital at risk for PetroSA is exceeding 2% of
total assets.
Significant trust Approval from the CEF Board is needed when R467 000 001 < R655 000 000
funding of the trust is exceeding 2% of total
assets of PetroSA.
Significant Approval from the CEF Board is needed when R467 000 001 < R655 000 000
unincorporated joint venture capital at risk for PetroSA is exceeding 2%
venture of total assets.
Significant assets Approval from the CEF Board is needed on R467 000 001 < R655 000 000
acquisition and disposal of any immovable
property such as land and buildings, and
movable assets when the cost exceeds 2% of
the total assets of PetroSA.
Significant business Approval from the CEF Board is needed on R467 000 001 < R655 000 000
commencement and cessation of a business
activity that is representing or will be
representing more than 2% of PetroSA’s total
assets.
Significant change Approval from the CEF Board is needed when R467 000 001 < R655 000 000
engaging in new business that is unrelated to
the business and where the investment exceeds
2% of all assets.
6. APPROVAL FROM DOE/EXECUTIVE AUTHORITY AND INFORM NATIONAL TREASURY VIA CEF
Significant partnership Approval from the DOE/executive authority is > R655 000 000
needed when capital at risk for PetroSA exceeds
R655 million.
Significant trust Approval from the DOE/executive authority > R655 000 000
is needed when funding of the trust exceeds
R655 million.
Significant Approval from the DOE/executive authority is > R655 000 000
unincorporated joint needed when venture capital at risk for PetroSA
venture exceeds R655 million.
Significant assets Approval from the DOE/executive authority > R655 000 000
is needed on acquisition and disposal of any
immovable property such as land and buildings,
and movable assets when the cost exceeds
R655 million.
Significant business Approval from the DOE/executive authority is > R655 000 000
needed on commencement and cessation of a
business activity that is representing or will be
representing more than R655 million.

(CONTINUED)
Significant change Approval from the DOE/executive authority is > R655 000 000
needed when engaging in new business that
is unrelated to the business and where the
investment exceeds R655 million.
Significant shareholding Approval from DOE/executive authority is
needed for the establishment or participation in
the establishment of a company.
Approval from DOE/executive authority is
needed when an acquisition or disposal of a
shareholding in a company results in a change
of at least 20% of the company’s equity.

STATEMENT FROM COMPANY SECRETARY
In my capacity as Company Secretary, I hereby confirm, in terms of section 268G(d) of the Companies Act No.
61 of 1973, that for the year ended, 31 March 2011, the Company has lodged with the Registrar of Companies
all such returns as are required of a company in terms of this Act, and that all such returns are, to the best of my
knowledge and belief, true, correct and up to date.
Adv. PSV Ngaba

Cape Town
20 July 2011

STATEMENT OF FINANCIAL POSITION
as at 31 March 2011
Group Company
2011 2010 2011 2010
Note(s) R’000 R’000 R’000 R’000
ASSETS
Non-current assets
Property, plant and equipment 2 7 240 534 6 657 675 7 238 126 6 653 384
Intangible assets 3 80 273 81 694 1 111 2 532
Deferred tax 5 – 72 478 – 72 478
Investments in subsidiaries 6 – – 6 279 5 787
Investments in associates 7 – – 23 490 23 490
Other financial assets 8 116 975 135 402 1 323 655 896 330
Amounts held by holding company 9 489 021 537 648 489 021 537 648
7 926 803 7 484 897 9 081 682 8 191 649
Current assets
Inventories 10 1 575 827 1 415 751 1 510 043 1 352 360
Current tax receivable 413 157 286 566 413 157 284 851
Trade and other receivables 12 2 070 344 1 788 367 2 072 184 1 754 863
Deferred tax – 286 – –
Cash and cash equivalents 13 11 852 498 10 027 026 11 795 852 9 979 415
15 911 826 13 517 996 15 791 236 13 371 489
Non-current assets held for sale and assets
of disposal groups 14 1 167 772 988 186 – –
TOTAL ASSETS 25 006 401 21 991 079 24 872 918 21 563 138
EQUITY AND LIABILITIES

Equity
Share capital 15 2 755 936 2 755 936 2 755 936 2 755 936
Reserves (87 004) (54 845) 142 (1 951)
Retained income 13 975 837 13 144 482 14 643 933 13 373 372
16 644 769 15 845 573 17 400 011 16 127 357
Liabilities
Non-current liabilities
Loans from Group companies 11 – – 1 –
Provisions 17 5 649 819 3 913 618 5 623 427 3 888 901
5 649 819 3 913 618 5 623 428 3 888 901
Current liabilities
Loans from Group companies 11 – – – 1 292
Loans from shareholders 16 – 17 991 – 17 991
Current tax payable 2 880 37 – –
Provisions 17 363 128 95 242 362 601 94 751
Trade and other payables 18 1 626 409 1 471 322 1 486 878 1 313 420
Bank overdraft 13 – 119 426 – 119 426
1 992 417 1 704 018 1 849 479 1 546 880
Liabilities of disposal groups 14 719 396 527 870 – –
Total liabilities 8 361 632 6 145 506 7 472 907 5 435 781
TOTAL EQUITY AND LIABILITIES 25 006 401 21 991 079 24 872 918 21 563 138

STATEMENT OF COMPREHENSIVE INCOME
Group Company
2011 2010 2011 2010
Note(s) R’000 R’000 R’000 R’000
CONTINUING OPERATIONS
Revenue 19 10 565 385 8 090 168 10 565 042 8 088 421
Cost of sales (8 854 583) (7 580 057) (8 846 840) (7 571 866)
GROSS PROFIT 1 710 802 510 111 1 718 202 516 555
Other income 256 505 533 091 196 714 352 206
Operating expenses (1 903 505) (2 379 814) (1 509 532) (2 653 057)
OPERATING PROFIT (LOSS) 20 63 802 (1 336 612) 405 384 (1 784 296)
Investment income 22 859 887 971 939 974 810 1 176 522
Finance costs 23 (422 534) (397 532) (422 530) (397 259)
PROFIT (LOSS) BEFORE TAXATION 501 155 (762 205) 957 664 (1 005 033)
Taxation 24 308 519 348 634 312 897 349 173
PROFIT (LOSS) FROM CONTINUING
OPERATIONS 809 674 (413 571) 1 270 561 (655 860)
DISCONTINUED OPERATIONS
Profit for the year from discontinuing
operations 14 21 681 57 120 – –
PROFIT (LOSS) FOR THE YEAR 831 355 (356 451) 1 270 561 (655 860)
OTHER COMPREHENSIVE INCOME:
Exchange differences on translating foreign
operations (32 159) (131 719) 2 093 5 767
TOTAL COMPREHENSIVE INCOME
(LOSS) 799 196 (488 170) 1 272 654 (650 093)
NET PROFIT (LOSS) ATTRIBUTABLE TO:

Owners of the parent:
Profit(loss) for the year from continuing
operations 809 674 (413 571) 1 270 561 (655 860)
Profit for the year from discontinuing
operations 21 681 57 120 – –
Exchange differences on translating
foreign operations (32 159) (131 719) 2 093 5 767
799 196 (488 170) 1 272 654 (650 093)

STATEMENT OF CHANGES IN EQUITY
Foreign
Total currency
Share Share share translation Retained Total
capital premium capital reserve income equity
R’000 R’000 R’000 R’000 R’000 R’000
GROUP
Balance at 1 April 2009 2 2 755 934 2 755 936 76 874 13 500 933 16 333 743
Changes in equity
Total comprehensive loss for the
year – – – (131 719) (356 451) (488 170)
Total changes – – – (131 719) (356 451) (488 170)
Balance at 1 April 2010 2 2 755 934 2 755 936 (54 845) 13 144 482 15 845 573
Changes in equity
Total comprehensive income for
the year – – – (32 159) 831 355 799 196
Total changes – – – (32 159) 831 355 799 196
Balance at 31 March 2011 2 2 755 934 2 755 936 (87 004) 13 975 837 16 644 769
Note 15 15 15
COMPANY
Balance at 1 April 2009 2 2 755 934 2 755 936 (7 718) 14 029 232 16 777 450
Changes in equity
Total comprehensive loss for the
year – – – 5 767 (655 860) (650 093)
Total changes – – – 5 767 (655 860) (650 093)
Balance at 1 April 2010 2 2 755 934 2 755 936 (1 951) 13 373 372 16 127 357
Changes in equity
Total comprehensive income for
the year – – – 2 093 1 270 561 1 272 654
Total changes – – – 2 093 1 270 561 1 272 654
Balance at 31 March 2011 2 2 755 934 2 755 936 142 14 643 933 17 400 011
Note 15 15 15

STATEMENT OF CASH FLOWS
Group Company
2011 2010 2011 2010
Note(s) R’000 R’000 R’000 R’000
CASH FLOWS FROM OPERATING
ACTIVITIES
Cash generated (utilised) by operations 25 862 967 (1 069 883) 1 183 924 (208 537)
Interest income 859 886 971 939 973 087 1 176 522
Dividends received 1 – 1 723 –
Dividend paid 26 – (375 000) – (375 000)
Finance costs (2 561) (18 713) (2 561) (18 440)
Tax received (paid) 27 257 536 (11 429) 257 069 (9 315)
Cash flows of held for sale/discontinued
operations 28 33 621 503 478 – –
NET CASH FROM OPERATING
ACTIVITIES 2 011 450 392 2 413 242 565 230
CASH FLOWS FROM INVESTING

ACTIVITIES
Purchase of property, plant and equipment 2 (197 071) (1 274 583) (196 922) (1 273 036)
Sale of property, plant and equipment 2 1 866 976 1 728 72
Purchase of other intangible assets 3 – (19) – (19)
Loans to Group companies impaired/written
off – (355) 35 402 (1 234 488)
Loans (advanced to) paid by Group
companies – – – 3 206
Purchase of financial assets 18 427 (1 474) (427 325) 704 651
Repayment of amounts held by holding
company 48 627 – 48 627 –
Cash flow from subsidiaries – – (492) (135)
NET CASH FROM INVESTING
ACTIVITIES (128 151) (1 275 455) (538 982) (1 799 749)
CASH FLOWS FROM FINANCING

ACTIVITIES
Repayment of shareholder’s loan (17 995) (193 186) (17 991) (193 186)
NET CASH FROM FINANCING
ACTIVITIES (17 995) (193 186) (17 991) (193 186)
CASH AND CASH EQUIVALENTS

MOVEMENT FOR THE YEAR 1 865 304 (1 468 249) 1 856 269 (1 427 705)
Cash and cash equivalents at the beginning
of the year 9 907 600 11 314 712 9 859 989 11 226 557
Effect of exchange rate movement on cash
balances 79 594 61 137 79 594 61 137
CASH AND CASH EQUIVALENTS AT
THE END OF THE YEAR 13 11 852 498 9 907 600 11 795 852 9 859 989

ACCOUNTING POLICIES
1. PRESENTATION OF ANNUAL Company Financial Statements

FINANCIAL STATEMENTS Investments in subsidiaries, associates and joint
ventures in the financial statements presented by the
The following are the principal accounting policies
Company are recognised at cost, except where there
of the Group which are, in all material respects,
is a permanent decline in the value in which case they
consistent with those of the previous year, except as
are written down to fair value.
otherwise indicated:
Consolidated Financial Statements
1.1 Basis of Preparation
Business combinations
The financial statements are prepared under the historical
Subsidiaries are entities controlled by the holding
cost basis, except where otherwise specified.
Company. The consolidated financial statements
The Group annual financial statements are prepared in incorporate the assets, liabilities, income, expenses
accordance with South African Statements of Generally and cash flows of the company and all entities
Accepted Accounting Practice, the Companies Act of controlled by the Company as if they are a single
South Africa and the Corporate Laws Amendment Act. economic entity.
These annual financial statements are presented in Acquisitions of subsidiaries and businesses are
South African Rands. Rounding is to the nearest Rand accounted for using the acquisition method. The
in thousands. cost of the business combination is measured as
Assets and liabilities or income and expenditure will the aggregate of the fair values (at the date of
not be off set, unless it is required or permitted by a acquisition) of assets given, liabilities incurred or
standard. assumed and equity instruments issued by the
Group in exchange for control of the acquiree,
1.2 Basis of Consolidation plus any costs directly attributable to the business
The consolidated financial statements incorporate the combination. Acquisition related costs are expensed
annual financial statements of the entity and enterprises as incurred. The acquiree’s identifiable assets,
controlled by the entity at 31 March each year. liabilities and contingent liabilities that meet the
Control is achieved where the entity has the power to conditions for recognition under IFRS 3 (AC 140):
govern the financial and operating policies of an investee Business Combinations are recognised at their fair
enterprise so as to obtain benefits from its activities. values at the acquisition date, except for non-current
assets (or disposal groups) that are classified as
On acquisition, the assets and liabilities of the
held for sale in accordance with IFRS 5 (AC 142):
relevant subsidiaries are measured at their fair values
Non-current Assets Held for Sale and Discontinued
at the effective date of acquisition.
Operations, which are recognised and measured at
The results of subsidiaries, associates and joint ventures fair value less costs to sell.
acquired or disposed of during the year are included in
Goodwill is calculated as the excess of the sum of
the consolidated statement of comprehensive income
a) fair value of consideration transferred, b) the
from the effective date of acquisition or up to the
recognised amount of any non-controlling interest
effective date of disposal, as appropriate.
in the acquiree and c) acquisition date fair value of
Where necessary, adjustments are made to the any existing equity interests in the acquiree over the
annual financial statements of subsidiaries to bring acquisition date fair values of net identifiable assets.
the accounting policies used in line with the Group's If, after reassessment, the Group’s interest in the
accounting policies. net fair value of the acquiree’s identifiable assets,
All significant intercompany transactions, unrealised liabilities and contingent liabilities exceeds the cost
profit and losses, and balances between Group of the business combination, the excess is recognised
enterprises are eliminated on consolidation. immediately in profit or loss.
The most recent audited annual financial statements The Group treats transactions with non-controlling
of associates, joint ventures and subsidiaries are used interests as transactions with equity owners of the
where available, which are all within three months Group. For purchases from non-controlling interests,
of the year-end of the Group. Adjustments are made the difference between any consideration paid and
to the financial results for material transactions and the relevant share acquired of the carrying value of
events in the intervening period. Losses in excess of net assets of the subsidiary is recorded in equity.
the Group’s interest are not recognised unless there is Gains or losses on disposals to non-controlling
a binding obligation to contribute to the losses. interests are also recorded in equity.

1.2 Basis of Consolidation (continued) If the ownership interest in an associate is reduced but
significant influence is retained, only a proportionate
When the Group ceases to have control or significant
share of the amounts previously recognised in other
influence, any retained interest in the entity is
comprehensive income are reclassified to profit or loss
remeasured to its fair value, with the change in
carrying amount recognised in profit or loss. The fair where appropriate.
value is the initial carrying amount for the purposes Interest in joint ventures
of subsequently accounting for the retained interest A joint venture is a contractual agreement between
as an associate, joint venture or financial asset. In two or more parties to undertake an economic activity
addition, any amounts previously recognised in other which is under joint control, that is when the strategic
comprehensive income in respect of that entity are
financial and operating policy decisions relating to the
accounted for as if the Group had directly disposed
activities of the joint venture require the unanimous
of the related assets or liabilities. This may mean that
consent of the parties sharing control.
amounts previously recognised in other comprehensive
income are reclassified to profit or loss. Where a Group entity undertakes its activities under
joint venture arrangements directly, the Group’s
Interest in associates
share of jointly-controlled assets and any liabilities
An associate is an enterprise in which the Group
incurred jointly with other venturers are recognised
has significant influence, through participation in
in the financial statements of the relevant entity
the financial and operating policy decisions of the
and classified according to their nature. Liabilities
investee, but not control.
and expenses incurred directly in respect of interests
The results and assets and liabilities of associates in jointly controlled assets are accounted for on an
are incorporated in the financial statements by accrual basis. Income from the sale or use of the
using the equity method of accounting, except Group’s share of the output of jointly controlled assets,
when the investment is classified as held for sale, in and its share of joint venture expenses, are recognised
which case it is accounted for in accordance with when it is probable that the economic benefits
IFRS 5 (AC 142): Non-current Assets Held for Sale associated with the transactions will flow to/from the
and Discontinued Operations. Under the equity Group and their amount can be measured reliably.
method, investments in associates are carried in the
consolidated statement of financial position at cost as Joint venture arrangements that involve the
adjusted for post-acquisition changes in the Group’s establishment of a separate entity in which each
share of the net assets of the associate, less any venturer has an interest are referred to as jointly
impairment in the value of individual investments. controlled entities. The Group reports its interests
Losses of an associate in excess of the Group’s in jointly controlled entities using proportionate
interest in that associate (which includes any long- consolidation, except when the investment is classified
term interests that, in substance, form part of the as held for sale, in which case it is accounted for in
Group’s net investment in associate) are recognised accordance with IFRS 5 (AC 142): Non-current Assets
only to the extent that the Group has incurred legal Held for Sale and Discontinued Operations. The
or constructive obligations or made payments on Group’s share of the assets, liabilities, income and
behalf of the associate. expenses of jointly controlled entities are combined
Any excess of the cost of acquisition over the Group’s with the equivalent items in the consolidated financial
share of the net fair value of the identifiable assets, statements on a line-by-line basis.
liabilities and contingent liabilities of the associate Any goodwill arising on the acquisition of the Group’s
recognised at the date of acquisition is recognised interest in a jointly controlled entity is accounted for
as goodwill. The goodwill is included within the in accordance with the Group’s accounting policy for
carrying amount of the investment and is assessed for
goodwill arising on the acquisition of a subsidiary.
impairment as part of that investment. Any excess of
the Group’s share of the net fair value of the identifiable All significant intercompany transactions and
assets, liabilities and contingent liabilities over the balances between Group entities are eliminated on
cost of acquisition, after reassessment, is recognised proportionate consolidation to the extent of the
immediately in profit or loss. Group’s interest in the joint venture.

ACCOUNTING POLICIES (CONTINUED)
1.3 Translation of Foreign Currencies 1.5 Property, Plant and Equipment

Transactions Property, plant and equipment represent tangible
Foreign currency transactions are recognised, initially items that are held for use in the production or
in Rand, by applying the foreign currency amount to supply of goods or services, for rental to others, or
the exchange rate between the Rand and the foreign for administrative purposes and are expected to be
currency at the date of the transaction, and is restated used during more than one period.
at each reporting date by using the ruling exchange
Carrying Amounts
rate at that date.
All property, plant and equipment are stated at cost
Statement of Financial Position less accumulated depreciation and accumulated
At each reporting date: impairment losses.
• foreign currency monetary items are measured Cost

using the closing rate; Cost includes all costs directly attributable to bringing
• non-monetary items, which are carried in terms of the assets to the working condition for their intended
historical cost denominated in a foreign currency, are use. Improvements are capitalised. Maintenance,
reported using the exchange rate at the date of the repairs and renewals which neither materially add
transaction; and to the value of assets nor appreciably prolong their
useful lives are charged against income.
• non-monetary items which are carried at fair value
denominated in a foreign currency are reported Finance costs directly associated with the construction
using the exchange rates that existed when the or acquisition of major assets are capitalised at
values were determined. interest rates relating to loans specifically raised for
that purpose, or at the average borrowing rate where
Exchange Differences the general pool of borrowings is utilised.
Exchange differences arising on the settlement
of monetary items or on reporting a company’s
Derecognition
monetary items at rates different from those at which The carrying amount of an item of property, plant and
they were initially recorded during the period, or equipment is derecognised on disposal.
reported in previous annual financial statements, are Gains or losses on disposal of property, plant and
recognised as income or expenses in the period in equipment are determined by reference to their
which they arise. Exchange differences are capitalised carrying amount. On disposal of revalued assets,
where they relate to the purchase or construction of amounts in the revaluation reserve relating to that
property, plant and equipment. asset are transferred to retained earnings.
Foreign Entities The gain or loss arising from derecognition of an
In translating the financial statements of a foreign item of property, plant and equipment is included in
entity for incorporation in the Group financial profit or loss. Gains on disposal will not be classified
statements, the following is applied: as revenue.
• The assets and liabilities, both monetary and Depreciation
non-monetary, of the foreign entity are translated
Depreciation is charged so as to write off the
at the closing exchange rate at the financial year-
depreciable amount of the assets, other than land,
end date.
over their estimated useful lives to estimated residual
• Income and expense items of the foreign entity values, using the straight line method or other
are translated at the weighted average rates of acceptable method to write off the cost of each asset
exchange for the year. that reflects the pattern in which the asset’s future
• All resulting exchange differences are taken economic benefits are expected to be consumed by
directly to the foreign currency translation reserve the entity.
which is classified as a non-distributable reserve. Where significant parts of an item have different
On disposal the related amount in this reserve useful lives to the item itself, these parts are
will be recognised in profit or loss. depreciated over their estimated useful lives.
1.4 Comparative Figures The following methods and rates are used during the
Comparative figures are restated in the event of a year to depreciate property, plant and equipment to
change in accounting policy or prior period error. estimated residual values:

1.5 Property, Plant and Equipment Any impairment identified is charged to the
(continued) statement of comprehensive income as additional
depreciation. Where conditions giving rise to
Item Average useful life
impairment subsequently reverse, the effect of the
Land Not depreciated
impairment charge is also reversed as a credit to
Buildings 40 years the statement of comprehensive income, net of any
Furniture, fittings and 2 – 10 years depreciation that would have been charged since the
communication equipment impairment.
Motor vehicles 4 – 5 years
Restoration Costs
Computer equipment 3 – 6 years
Cost of property, plant and equipment also includes
An exception is made for production assets and
the estimated costs of dismantling and removing the
Restoration costs, where the units of production
assets and site rehabilitation costs.
method is used to calculate depreciation. Reference
to the supplementary reserves disclosure can be made Estimated decommissioning and restoration costs
for more information on the reserves used. are based on current requirements, technology and
Improvements to leased premises are written off over price levels. Provision is made for all net estimated
the period of the lease. abandonment costs as soon as an obligation to
rehabilitate the area exists, based on the present
The methods of depreciation, useful lives and residual
value of the future estimated costs. These costs are
values are reviewed annually.
deferred and are depreciated over the useful life
Production Assets (Oil and Gas Fields) of the assets to which they relate using the unit
Oil and gas production assets are the aggregated of production method based on the same reserve
exploration and evaluation tangible assets, and quantities as are used for the calculation of depletion
development expenditure associated with the of oil and gas production assets.
production of proved reserves.
The amount recognised is the estimated cost of
Subsequent expenditure which enhances or extends
restoration, discounted to its net present value,
the performance of oil and gas production assets
and is reassessed each year in accordance with
beyond their original specifications is recognised as
capital expenditure and added to the original cost of local conditions and requirements. Changes in
the asset. the estimated timing of decommissioning or
decommissioning cost estimates are dealt with
Production assets are depreciated over their expected
prospectively by recording an adjustment to the
useful lives. This applies from the date production
provision, and a corresponding adjustment to
commences, on a unit of production basis, which is
the ratio of oil and gas production in the period to the property, plant and equipment. The unwinding of the
estimated quantities of proved and probable reserves discount on the restoration provision is included as a
at the end of the period plus the production in the finance cost.
period, on a field-by-field basis. Units of production
1.6 Exploration, Evaluation and
rates are based on the proved and probable developed
reserves, which are oil, gas and other mineral reserves
Development of Oil and Gas Wells
estimated to be recoverable from existing facilities The “successful efforts” principle is used to account
using current operating methods. for oil and gas exploration and evaluation activities.
Where there has been a change in economic Pre-licensing Cost
conditions that indicates a possible impairment in These are costs incurred prior to the acquisition of a
a discovery field, the recoverability of the net book
legal right to explore for oil and gas. They may include
value relating to that field is assessed by comparison
speculative seismic data and subsequent geological
with the estimated discounted future cash flows
and geophysical analysis of this data, but may not be
based on management’s expectations of future
oil and gas prices and future costs. Where there is exclusive to such costs. If such analysis suggests the
evidence of economic interdependency between presence of reserves, then the costs are capitalised to
fields, such as common infrastructure, the fields an identified structure (field or reservoir). However,
are grouped as a single cash-generating unit for if the analysis is not definitive then these costs are
impairment purposes. expensed in the year they are incurred.

1.6 Exploration, Evaluation and Research costs are recognised in profit or loss when
Development of Oil and Gas Wells incurred.
(continued) Development costs are capitalised only if they result
Exploration and Evaluation Costs in an asset that can be identified, it is probable that
All costs relating to the acquisition of licences, the asset will generate future economic benefits
exploration and evaluation of a well, field or and the development cost can be reliably measured.
exploration area are initially capitalised. Directly Otherwise it is recognised in profit or loss.
attributable administration costs and interest payable
are capitalised in so far as they relate to specific
1.8 Impairment of Non-financial Assets
development activities. At each reporting date, the Group reviews the
carrying amounts of its tangible and intangible
These costs are then written off as exploration costs in the
assets to determine whether there is any indication
statement of comprehensive income unless commercial
that those assets may be impaired. If such indication
reserves have been established or the determination
exists, the recoverable amount of the asset is
process has not been completed and there are no
estimated in order to determine the extent of the
indications of impairment.
impairment loss (if any). Where it is not possible to
Assets Pending Determination estimate the recoverable amount for an individual
Exploratory wells that discover potentially commercial asset, the recoverable amount is determined for the
reserves are capitalised pending a decision to further cash-generating unit to which the asset belongs.
develop or a firm plan to develop has been approved. Value in use is estimated taking into account future
These wells may remain capitalised for three years. cash flows, forecast market conditions and the
If no such plan or development exists or information expected lives of the assets.
is obtained that raises doubt about the economic or
operating viability then these costs will be recognised If the recoverable amount of an asset (or cash-
in the profit or loss of that year. If a plan or intention generating unit) is estimated to be less than its
to further develop these wells or fields exists, the carrying amount, its carrying amount is reduced
costs are transferred to development costs. to the higher of its recoverable amount and zero.
Impairment losses are recognised in profit or loss.
Development Costs Subsequent to the recognition of the impairment
Costs of development wells, platforms, well equipment loss, the depreciation or amortisation charge for the
and attendant production facilities are capitalised. The asset is adjusted to allocate its remaining carrying
cost of production facilities capitalised includes finance
value, less any residual value, over its remaining
costs incurred until the production facility is completed
useful life.
and ready for the start of the production phase. All
development wells are not depreciated until production If an impairment loss is subsequently reversed, the
starts and then they are depreciated on the units of carrying amount of the asset (or cash-generating unit)
production method calculated using the estimated is increased to the revised estimate of its recoverable
proved and probable reserves. amount, but limited to the carrying amount, that
would have been determined had an impairment loss
Dry Wells
not been recognised in prior years. A reversal of an
Geological and geophysical costs, as well as all other costs
impairment loss is recognised in profit or loss.
relating to dry exploratory wells costs are recognised in
the profit and loss in the year they are incurred. 1.9 Leases
1.7 Intangible Assets Finance leases are recognised as assets and liabilities
An intangible asset is an identifiable non-monetary at the lower of the fair value of the assets and the
asset without physical substance. present value of the minimum lease payments at the
date of the acquisition. Finance costs represent the
Intangible assets are initially recognised at cost if difference between the total leasing commitments
acquired separately or internally generated or at fair and the fair value of the assets acquired. Finance
value if acquired as part of a business combination. costs are charged to the profit and loss over the term
If assessed as having an indefinite useful life, the of the lease at the interest rates applicable to the
intangible asset is not amortised but tested for
lease on the remaining balance of the obligations.
impairment annually and impaired if necessary. If
assessed as having a finite useful life, it is amortised Rentals payable under operating leases are recognised in
over its useful life using a straight-line basis and profit or loss on a straight-line basis over the term of the
tested for impairment if there is an indication that it relevant lease where significant or another basis if more
may be impaired. representative of the time pattern of the user’s benefit.

1.23 Adoption of Generally Accepted Group will apply IAS 27 (revised) prospectively to
Accounting Practice (continued) transactions with non-controlling interests from
1 January 2010.
position can be classied as investing activities in
the statement of cash ow. Consequently, cash 9. IAS 38 (amendment): Intangible Assets
ows in respect of development costs that do not The amendment is part of the IASB’s annual
meet the criteria in IAS 28: Intangible Assets for improvements project published in April 2009
capitalisation as part of an internally-generated and the Group and Company will apply IAS 38
intangible asset (and, therefore, are recognised in (amendment) from the date IFRS 3 (revised) is
prot or loss as incurred) have been reclassied adopted. The amendment claries guidance in
from investing activities to operating activities in measuring the fair value of an intangible asset
the statement of cash ow. Prior year amounts acquired in a business combination and it permits
have been restated for consistent presentation. the grouping of intangible assets as a single asset
if each asset has similar useful economic lives. The
6. IAS 21 (amended): The Effects of Changes in
amendment will not result in a material impact on
Foreign Exchange Rates (effective 1 July 2010)
the Group or Company’s nancial statements.
Consequential amendments were made to
IAS 21 due to the changes to IAS 27: Consolidated The following standards and amendments to
and Separate Financial Statements. The existing standards have been published and are not
amendment claries the transition rules in respect yet effective and the Group has not adopted them
of the disposal or partial disposal of an interest in earlier.
a foreign operation. 1. IFRS 3 (amended): Business Combinations
7. Revised IAS 24 (revised): Related Party Disclosures (effective from 1 July 2010)
The rst amendment to IAS 24 modies the When IFRS 3 (2008) was issued, it was unclear as
denition of a related party and removes to whether the new requirement for contingent
inconsistencies. The second amendment to consideration should be applied to contingent
IAS 24 simplies disclosures for government consideration arising from business combinations
related entities. Until now, if a government that took place before the application of
controlled, or signicantly inuenced, an entity, IFRS 3. Consequently, the IASB amended
the entity was required to disclose information IFRS 3 as part of Improvements to IFRS’s issued
about all transactions with other entities in 2010 to clarify that the new requirements
controlled, or signicantly inuenced, by the same for contingent consideration set out in IFRS 3
government. The revised standard still requires should not be applied to business combinations
disclosures that are important to users of nancial whose acquisition date preceded the application
statements, but eliminates requirements to of IFRS 3. The amendments are effective for
disclose information that is costly to gather and annual periods beginning on or after 1 July 2010,
of less value to users. It achieves this balance by with earlier application permitted. At the date
requiring disclosure about these transactions only of the application of IFRS 3, where entities have
if they are individually or collectively signicant. outstanding contingent consideration arrangements
arising from business combinations whose
8. IAS 27 (revised): Consolidated and Separate Financial acquisition dates preceded the application of
Statements (effective from 1 July 2010) IFRS 3, they should consider early application of
The revised standard has affected the Group’s the amendments.
accounting policies regarding changes in
ownership interests in its subsidiaries that do As part of Improvements to IFRS issued in
not result in loss of control. In prior years, in the 2010, IFRS 3 was amended to clarify that the
absence of specic requirements in IFRS, increases measurement choice regarding non-controlling
in interests in existing subsidiaries were treated in interests at the date of acquisition (see above)
the same manner as the acquisition of subsidiaries, is only available in respect of non-controlling
interests that are present ownership interests
with goodwill or a bargain purchase gain being
and that entitle their holders to a proportionate
recognised, when appropriate; for decreases
share of the entity’s net assets in the event of
in interests in existing subsidiaries that did not
liquidation. All other types of non-controlling
involve a loss of control, the difference between
interests are measured at their acquisition date
the consideration received and the adjustment
fair value, unless another measurement basis is
to the non-controlling interests was recognised
required by other standards.
in prot or loss. Under IAS 27 (2008), all such
increases or decreases are dealt with in equity, In addition, as part of Improvements to IFRS
with no impact on goodwill or prot or loss. The issued in 2010, IFRS 3 was amended to give more
PetroSA ANNUAL REPORT 2011

1.23 Adoption of Generally Accepted 1.24 Key Assumptions Made by

Accounting Practice (continued) Management in Applying
guidance regarding the accounting for share- Accounting Policies
based payment awards held by the acquiree’s Critical Accounting Estimates and Judgements
employees. Specifically, the amendments specify In preparing the annual financial statements in terms
that share-based payment transactions of the of SA GAAP, the Group’s management is required
acquiree that are not replaced should be measured to make certain estimates and assumptions that
in accordance with IFRS 2: Share-based Payment at may materially affect reported amounts of assets
the acquisition date (“market-based measure”). and liabilities at the date of the annual financial
2. IFRS 7 (amended): Financial Instruments – statements and the reported amounts of revenues
Disclosures (effective from 1 January 2011) and expenses during the reported period and
The first amendment to IFRS 7 clarifies the required the related disclosures. As these estimates and
level of disclosures about credit risk and collateral held assumptions concern future events, due to the
and provide relief from disclosures previously required inherent uncertainty involved in this process, the
regarding renegotiated loans. The amendments actual results often vary from the estimates. These
have been applied retrospectively. As the change in estimates and judgements are based on historical
accounting policy only impacts presentation aspects, experience, current and expected future economic
there is no impact on earnings per share. conditions and other factors, including expectations
of the future events that are believed to be
The second amendments to this standard require
reasonable under the circumstances.
additional disclosure on transfer transactions of
financial assets, including the possible effects Environmental and Decommissioning
of any residual risks that the transferring entity Provision
retains. The amendments also require additional Provision is made for environmental and
disclosures if a disproportionate amount of transfer decommissioning costs where either a legal or
transactions are undertaken around the end of a constructive obligation is recognised as a result of past
reporting period. events. Estimates are made in determining the present
obligation of environmental and decommissioning
3. IFRS 9: Financial Instruments (issued in November 2009)
provisions, which include the actual estimate, the
This standard is the first step in the process
discount rate used and the expected date of closure
to replace IAS 39: Financial Instruments –
of mining activities in determining the present value
Recognition and Measurement. IFRS 9 introduces
new requirements for classifying and measuring of environmental and decommissioning provisions.
financial assets and is likely to affect the Group’s Estimates are based upon costs that are regularly
accounting for its financial assets. The standard is reviewed by internal and external experts, and
not applicable until 1 January 2013. adjusted as appropriate for new circumstances.
4. IAS 12: Income Taxes (effective 1 January 2012) Other Provisions

IAS 12 requires an entity to measure the deferred For other provisions, estimates are made of legal or
tax relating to an asset depending on whether the constructive obligations resulting in the raising of
entity expects to recover the carrying amount of provisions and the expected date of probable outflow
the asset through use or sale. It can be difficult of economic benefits to assess whether the provision
and subjective to assess whether recovery will be should be discounted.
through use or through sale when the asset is Impairments and Impairment Reversals
measured using the fair value model in IAS 40:
Impairment tests are performed when there is an
Investment Property. The amendment provides a
indication of impairment of assets or a reversal of
practical solution to the problem by introducing a
previous impairments of assets. Management therefore
presumption that recovery of the carrying amount
has implemented certain impairment indicators and
will, normally, be through sale.
these include movements in exchange rates, commodity
As a result of the amendments, SIC 21: Income prices and the economic environment its businesses
Taxes – Recovery of Revalued Non-depreciable operate in. Estimates are made in determining the
Assets would no longer apply to investment recoverable amount of assets which include the
properties carried at fair value. The amendments estimation of cash flows and discount rates used. In
also incorporate into IAS 12 the remaining estimating the cash flows, management bases cash flow
guidance previously contained in SIC 21, which is projections on reasonable and supportable assumptions
accordingly withdrawn. that represent management’s best estimate of the

range of economic conditions that will exist over the remaining useful life of the assets, based on publicly available
information. The discount rates used are pre-tax rates that reflect the current market assessment of the time value of
money and the risks specific to the assets for which the future cash flow estimates have not been adjusted.
Contingent Liabilities
Management considers the existence of possible obligations which may arise from legal action as well as the
possible non-compliance of the requirements of completion guarantees and other guarantees provided. The
estimation of the amount disclosed is based on the expected possible outflow of economic benefits should there
be a present obligation.
Evaluation of the Useful Life of Assets
On an annual basis, management evaluates the useful life of all assets. In carrying out this exercise, experience of
assets’ historical performance and the medium-term business plan are taken into consideration.

NOTES TO THE ANNUAL FINANCIAL STATEMENTS
2. PROPERTY, PLANT AND EQUIPMENT

2011 2010
Cost/ Accumulated Carrying Cost/ Accumulated Carrying
valuation depreciation value valuation depreciation value
R’000 R’000 R’000 R’000 R’000 R’000
GROUP
Land 26 645 – 26 645 16 715 – 16 715
Production assets 19 861 937 (16 295 126) 3 566 811 18 873 930 (15 632 034) 3 241 896
Furniture, fittings,
office equipment and
vehicles 584 751 (430 835) 153 916 580 798 (355 115) 225 683
Restoration costs 1 889 355 (582 124) 1 307 231 601 029 (582 123) 18 906
Shutdown costs
capitalised 461 705 (307 804) 153 901 461 705 (153 902) 307 803
Assets under
development 2 032 030 – 2 032 030 2 846 672 – 2 846 672
Total 24 856 423 (17 615 889) 7 240 534 23 380 849 (16 723 174) 6 657 675
COMPANY
Land 26 645 – 26 645 16 715 – 16 715
Production assets 19 861 937 (16 295 126) 3 566 811 18 873 930 (15 632 034) 3 241 896
vehicles 577 618 (426 110) 151 508 572 984 (351 592) 221 392
Restoration costs 1 889 355 (582 124) 1 307 231 601 029 (582 123) 18 906
Shutdown costs
capitalised 461 705 (307 804) 153 901 461 705 (153 902) 307 803
Assets under
development 2 032 030 – 2 032 030 2 846 672 – 2 846 672
Total 24 849 290 (17 611 164) 7 238 126 23 373 035 (16 719 651) 6 653 384

2. PROPERTY, PLANT AND EQUIPMENT (CONTINUED)
RECONCILIATION OF PROPERTY, PLANT AND EQUIPMENT: GROUP – 2011
Written Foreign
back exchange
Opening during move- Change in De-
balance Additions Disposals the year Transfers ments estimate preciation Total
R’000 R’000 R’000 R’000 R’000 R’000 R’000 R’000 R’000
Land 16 715 9 930 – – – – – – 26 645
Production
assets 3 241 896 – (836) – 988 858 – – (663 107) 3 566 811
Furniture,
fittings, office
equipment and
vehicles 225 683 12 109 (214) – – (1) – (83 661) 153 916
Restoration
costs 18 906 – – 107 292 – – 1 518 956 (337 923) 1 307 231
Shutdown costs
capitalised 307 803 – – – – – – (153 902) 153 901
Assets under
development 2 846 672 175 032 (816) – (988 858) – – – 2 032 030
6 657 675 197 071 (1 866) 107 292 – (1) 1 518 956 (1 238 593) 7 240 534
RECONCILIATION OF PROPERTY, PLANT AND EQUIPMENT: GROUP – 2010

Written Foreign
back exchange
Opening during move- Change in De-
balance Additions Disposals the year Transfers ments estimate preciation Total
R’000 R’000 R’000 R’000 R’000 R’000 R’000 R’000 R’000
Land 16 715 – – – – – – – 16 715
Production
assets 3 383 891 24 531 – – 304 477 – – (471 003) 3 241 896
Furniture,
fittings, office
equipment and
vehicles 259 374 48 379 (976) – – (13) – (81 081) 225 683
Restoration
costs 79 438 28 255 – 314 235 – – (357 256) (45 766) 18 906
Shutdown costs
capitalised – 22 – – 461 705 – – (153 924) 307 803
Assets under
development 2 409 846 1 201 651 – – (764 825) – – – 2 846 672
6 149 264 1 302 838 (976) 314 235 1 357 (13) (357 256) (751 774) 6 657 675

NOTES TO THE ANNUAL FINANCIAL STATEMENTS (CONTINUED)
2. PROPERTY, PLANT AND EQUIPMENT (CONTINUED)

RECONCILIATION OF PROPERTY, PLANT AND EQUIPMENT: COMPANY – 2011
Written
back
Opening during Change in De-
balance Additions Disposals the year Transfers estimate preciation Total
R’000 R’000 R’000 R’000 R’000 R’000 R’000 R’000
Land 16 715 9 930 – – – – – 26 645
Production assets 3 241 896 – (836) – 988 858 – (663 107) 3 566 811
vehicles 221 392 11 960 (76) – – – (81 768) 151 508
Restoration costs 18 906 – – 107 292 – 1 518 956 (337 923) 1 307 231
Shutdown costs
capitalised 307 803 – – – – – (153 902) 153 901
Assets under
development 2 846 672 175 032 (816) – (988 858) – – 2 032 030
6 653 384 196 922 (1 728) 107 292 – 1 518 956 (1 236 700) 7 238 126
RECONCILIATION OF PROPERTY, PLANT AND EQUIPMENT: COMPANY – 2010

Written Other
back changes,
Opening during move- De-
balance Additions Disposals the year Transfers ments preciation Total
R’000 R’000 R’000 R’000 R’000 R’000 R’000 R’000
Land 16 715 – – – – – – 16 715
Production assets 3 383 891 24 531 – – 304 477 – (471 003) 3 241 896
vehicles 253 740 46 832 (72) – – – (79 108) 221 392
Restoration costs 79 438 28 255 – 314 235 – (357 256) (45 766) 18 906
Shutdown costs
capitalised – 22 – – 461 705 – (153 924) 307 803
Assets under
development 2 409 846 1 201 651 – – (764 825) – – 2 846 672
6 143 630 1 301 291 (72) 314 235 1 357 (357 256) (749 801) 6 653 384
A register containing the information required by paragraph 22(3) of Schedule 4 of the Companies Act is
available for inspection at the registered office of the Company.
Restoration expenditure relates to the provision for restoration costs and is amortised on a units-of-production
basis over the expected useful life of the reserves.
PetroSA entered into an agreement with the Mossel Bay Municipality to jointly construct a desalination plant in
Mossel Bay. PetroSA’s portion has been included as an asset under construction. Total spend at 31 March 2011
amounts to R53 million (excluding VAT).
The units-of-production method is used in calculating depreciation on producing assets. Due to the nature of the
business the gas and oil reserves at the end of each financial year differs from the previous year. This necessitates
a change in the estimated remaining useful lives of these producing assets at the end of each financial year. The
effect on the current year is an increase in profit of R232 million and the effect on profits in future years is 2012:
R148 million (2013: R41 million; 2014: R17 million; 2015 – 2020: loss of R420 million).

3. INTANGIBLE ASSETS
2011 2010
Accumu- Accumu-
Cost/ lated Carrying Cost/ lated Carrying
valuation amortisation value valuation amortisation value
R’000 R’000 R’000 R’000 R’000 R’000
GROUP
Exploration
licensing fee 79 162 – 79 162 79 162 – 79 162
Software 5 573 (4 462) 1 111 5 573 (3 041) 2 532
Total 84 735 (4 462) 80 273 84 735 (3 041) 81 694
COMPANY
Software 5 573 (4 462) 1 111 5 573 (3 041) 2 532
RECONCILIATION OF INTANGIBLE ASSETS: GROUP – 2011

Opening
balance Amortisation Total
R’000 R’000 R’000
Exploration licensing fee 79 162 – 79 162
Software 2 532 (1 421) 1 111
81 694 (1 421) 80 273
RECONCILIATION OF INTANGIBLE ASSETS: GROUP – 2010

Opening
balance Additions Amortisation Total
R’000 R’000 R’000 R’000
Exploration licensing fee 79 162 – – 79 162
Software 3 997 19 (1 484) 2 532
83 159 19 (1 484) 81 694
RECONCILIATION OF INTANGIBLE ASSETS: COMPANY – 2011

Opening
balance Amortisation Total
R’000 R’000 R’000
Software 2 532 (1 421) 1 111
RECONCILIATION OF INTANGIBLE ASSETS: COMPANY – 2010

Opening
balance Additions Amortisation Total
R’000 R’000 R’000 R’000
Software 3 997 19 (1 484) 2 532

4. ASSETS PENDING DETERMINATION

2011 2010
Cost/ Accumulated Carrying Cost/ Accumulated Carrying
valuation depreciation value valuation depreciation value
R’000 R’000 R’000 R’000 R’000 R’000
GROUP
Exploratory wells – – – – – –
COMPANY
Exploratory wells – – – – – –
RECONCILIATION OF ASSETS PENDING DETERMINATION: GROUP – 2011

Opening
balance Total
R’000 R’000
Exploratory wells – –
RECONCILIATION OF ASSETS PENDING DETERMINATION: GROUP – 2010

Opening
balance Transfers Total
R’000 R’000 R’000
Exploratory wells 54 793 (54 793) –
RECONCILIATION OF ASSETS PENDING DETERMINATION: COMPANY – 2011

Opening
balance Total
R’000 R’000
Exploratory wells – –
RECONCILIATION OF ASSETS PENDING DETERMINATION: COMPANY – 2010

Opening
balance Transfers Total
R’000 R’000 R’000
Exploratory wells 54 793 (54 793) –

Group Company
2011 2010 2011 2010
R’000 R’000 R’000 R’000
5. DEFERRED TAX
DEFERRED TAX ASSET (LIABILITY)
Loans (1 139) 1 139 (1 139) 1 139
Tax losses available for set off against future
taxable income (122 706) 195 184 (122 706) 195 184
Provisions (794 776) 794 776 (794 776) 794 776
Capital allowances 918 621 (918 621) 918 621 (918 621)
Deferred tax – current portion – 286 – –
– 72 764 – 72 478
RECONCILIATION OF DEFERRED TAX

ASSET (LIABILITY)
At the beginning of the year 72 764 80 964 72 478 80 964
Originating and reversing temporary
differences (72 764) (8 200) (72 478) (8 486)
BALANCE AT THE END OF YEAR – 72 764 – 72 478
RECOGNITION OF DEFERRED TAX ASSET

In the current year, the deferred tax asset was written back as it is not expected to be utilised against taxable
profits in the foreseeable future.
The current portion of deferred tax relates to PetroSA Europe BV.

Group Company
2011 2010 2011 2010
R’000 R’000 R’000 R’000
6. INVESTMENTS IN SUBSIDIARIES
The carrying amounts of subsidiaries are
shown net of impairment losses.
PetroSA SYNFUEL INTERNATIONAL (PTY)

LIMITED (100%)
Shares
Balance at the beginning of the year – – 501 501
Provision for impairment – – (501) (501)
Balance at the end of the year – – – –
Shares – – 501 501
PetroSA SUDAN (PTY) LIMITED (100%)

Loans
Balance at the beginning of the year – – (0.12) (0.12)
Shares
Balance at the beginning of the year – – 0.12 0.12
Loans – – (0.12) (0.12)
Shares – – 0.12 0.12
Carrying amount of investment – – – –
PETROLEUM OIL AND GAS CORPORATION

OF SOUTH AFRICA (NAMIBIA) (PTY)
LIMITED (100%)
Loans
Shares
Loans – – (0.12) (0.12)
Shares – – 0.12 0.12
PetroSA NORTH AMERICA (100%)

Loans
Dissolution of subsidiary – – 0.07 –
Balance at the end of the year – – – (0.07)
Shares
Dissolution of subsidiary – – (0.07) –
Balance at the end of the year – – – 0.07
Loans – – – (0.07)
Shares – – – 0.07

Group Company
2011 2010 2011 2010
R’000 R’000 R’000 R’000
(CONTINUED)
PetroSA EGYPT (PTY) LIMITED (100%)

Loans
Shares
Loans – – (0.10) (0.10)
Shares – – 0.10 0.10
PetroSA NIGERIA LIMITED (100%)

Loans
Balance at the beginning of the year – – 1 421 1 285
Advances (repayments) during the year – – 492 136
Balance at the end of the year – – 1 913 1 421
Shares
Loans – – 1 913 1 421
Shares – – 1 235 1 235
Carrying amount of investment – – 3 148 2 656
PetroSA EUROPE BV (100%)

Shares
Balance at the beginning of the year – – 166 166
Share premium
Shares – – 166 166
Share premium – – 2 965 2 965
PetroSA BRASS (PTY) LIMITED (100%)

Loans
Shares
Loans – – (0.06) (0.06)
Shares – – 0.06 0.06

Group Company
2011 2010 2011 2010
R’000 R’000 R’000 R’000
(CONTINUED)
PetroSA GRYPHON MARIN PERMIT (PTY)

LIMITED (100%)
Loans
Shares
Loans – – (0.06) (0.06)
Shares – – 0.06 0.06
PetroSA IRIS (PTY) LIMITED (100%)
Loans
Shares
Loans – – (0.06) (0.06)
Shares – – 0.06 0.06
PetroSA THEMIS (PTY) LIMITED (100%)
Loans
Shares
Loans – – (0.12) (0.12)
Shares – – 0.12 0.12
PetroSA EQUATORIAL GUINEA (PTY)
LIMITED (100%)
Loans
Shares
Loans – – (0.06) (0.06)
Shares – – 0.06 0.06
TOTAL
Loans – – 1 912 1 420
Shares – – 1 903 1 903
Share premium – – 2 965 2 965
Provision for impairment – – (501) (501)

7. INVESTMENTS IN ASSOCIATES
Carrying Carrying
amount amount
Country of % holding % holding 2011 2010
Name of company incorporation 2011 2010 R’000 R’000
GROUP
GTL.F1 AG Switzerland 37.50% 37.50% – –
COMPANY
GTL.F1 AG Switzerland 37.50% 37.50% 23 490 23 490
ASSOCIATES WITH DIFFERENT REPORTING DATES

The reporting date of the associate is not the same as that of the Group. The Group results include the
performance of GTL.F1 AG for the year end 31 December 2010.
ASSOCIATES EQUITY ACCOUNTED FOR

Summary of associate’s financial information:
GTL.F1 AG 2011 2010

R’000 R’000
Total assets 83 029 92 642
Total liabilities (102 155) (92 378)
Revenue 25 032 –
Profit or (loss) (10 554) (18 243)

Group Company
2011 2010 2011 2010
R’000 R’000 R’000 R’000
8. OTHER FINANCIAL ASSETS
LOANS AND RECEIVABLES
GTL.F1 AG 30 367 31 031 30 367 31 031
This loan is interest free and has no fixed
repayment terms.
Lürgi 86 608 104 371 86 608 104 371
The amount owing by Lürgi is in respect of
a purchase of 12.5% share in the PetroSA
Statoil Joint Venture. The loan accrues interest
at EUROBOR +0.75%. The loan is repayable
based on dividends receivable by Lürgi from
the GTL.F1 AG technology company.
Brass Exploration Unlimited – – – –
The loan to Brass incurs interest at LIBOR
+14% and has no fixed repayment terms.
PetroSA Equatorial Guinea – – 1 206 680 759 980
The loan has no fixed repayment terms and
interest accrues at prime +2%.
PetroSA Sudan – – – –
PetroSA North America – – – 949
The loan for PetroSA North America also has
no fixed repayment terms and accrues interest
at LIBOR +2%.
PetroSA Egypt – – 945 158 990 351
PetroSA Gryphon Marin – – – 261 341
SUBTOTAL 116 975 135 402 2 268 813 2 148 023
LOANS AND RECEIVABLES (IMPAIRMENTS) – – (945 158) (1 251 693)
116 975 135 402 1 323 655 896 330
During the year, a decision was taken to write off PetroSA’s loan to PetroSA Gryphon Marin due to its
irrecoverability. PetroSA has impaired its loans to PetroSA Egypt of R945 million (2010: R990 million and 2010:
PetroSA Gryphon Marin for the value of R261 million), due to their recoverability being doubtful.
PetroSA has subordinated the loans to various subsidiaries in favour of other creditors of the above-mentioned
companies until such time as the assets fairly valued exceed the liabilities.

Group Company
2011 2010 2011 2010
R’000 R’000 R’000 R’000
9. AMOUNTS HELD BY HOLDING
COMPANY
This deposit is held by CEF (Pty) Limited as
security for guarantees issued by itself to third
parties on behalf of PetroSA.
CEF (Pty) Limited 489 021 537 648 489 021 537 648
10. INVENTORIES
The amounts attributable to the different
categories are as follows:
Petroleum fuels 923 146 733 128 923 146 733 128
Work-in-progress 84 276 82 226 84 276 82 226
Consumable stores, spares and catalysts 568 405 600 397 502 621 537 006
1 575 827 1 415 751 1 510 043 1 352 360
11. LOANS FROM GROUP COMPANIES

SUBSIDIARIES
PetroSA Sudan – – – 1 292
PetroSA Brass – – 1 –
– – 1 1 292
Non-current liabilities – – 1 –
Current liabilities – – – 1 292
– – 1 1 292
12. TRADE AND OTHER RECEIVABLES

Trade receivables 1 230 963 1 413 063 1 230 143 1 411 608
Prepayments 320 036 91 210 317 758 87 430
Deposits 207 209 – –
VAT 245 33 672 – –
Foreign receivables – 373 – –
Provision for bad debts (49 768) (50 964) (49 768) (50 958)
Sundry receivables 568 661 300 804 574 051 306 783
2 070 344 1 788 367 2 072 184 1 754 863
The provision for doubtful debts consists of a number of customer account balances. The balance is aged as
R43.5 million (2010: R49.7 million) at over 120 days, R5.3 million (2010: R1.3 million) between 90 – 120 days,
R0.1 million between 60 – 90 days, R0.1 million between 30 – 60 days and R0.7 million as current.

Group Company
2011 2010 2011 2010
R’000 R’000 R’000 R’000
12. TRADE AND OTHER RECEIVABLES
(CONTINUED)
RECONCILIATION OF PROVISION FOR
IMPAIRMENT OF TRADE AND OTHER
RECEIVABLES
Opening balance 50 964 48 076 50 958 48 070
Impairment losses recognised on receivables 12 495 3 894 12 495 3 888
Written off (11 409) – (11 403) –
Amounts recovered during the year (2 282) (1 006) (2 282) (1 000)
49 768 50 964 49 768 50 958
13. CASH AND CASH EQUIVALENTS

Cash and cash equivalents consist of cash
on hand and balances with banks, and
investments in money market instruments.
Cash and cash equivalents included in the
statement of financial position comprise the
following:
Short-term investments in money market and
cash on hand 11 825 512 10 002 688 11 795 852 9 979 415
Bank balances 1 449 – – –
Term deposits 25 537 24 338 – –
Bank overdraft – (119 426) – (119 426)
11 852 498 9 907 600 11 795 852 9 859 989
Current assets 11 852 498 10 027 026 11 795 852 9 979 415
Current liabilities – (119 426) – (119 426)
11 852 498 9 907 600 11 795 852 9 859 989
A term deposit of R25 537 212 (2010: R24 338 385) is held in the company Energy Africa Rehabilitation
(association incorporated under section 21), and is committed solely for the abandonment expenditure for the
Oribi field.

Group Company
2011 2010 2011 2010
R’000 R’000 R’000 R’000
14. DISCONTINUED OPERATIONS
OR DISPOSAL GROUPS OR NON-
CURRENT ASSETS HELD FOR SALE
The Group has decided to discontinue its
operations in PetroSA Nigeria and Brass
Exploration Unlimited. The assets and liabilities
of the disposal group are set out below.
PROFIT AND LOSS
Revenue 594 770 576 319 – –
Expenses (344 128) (378 005) – –
Net profit before tax 250 462 198 314 – –
Tax (228 961) (141 194) – –
21 681 57 120 – –
ASSETS AND LIABILITIES
Assets of disposal groups
Property, plant and equipment 80 499 154 577 – –
Inventories 6 604 8 574 – –
Trade and other receivables 144 456 111 957 – –
Cash and cash equivalents 936 213 713 078 – –
1 167 772 988 186 – –
Liabilities of disposal groups
Other financial liabilities 177 393 110 604 – –
Other payables 542 003 417 266 – –
719 396 527 870 – –
15. SHARE CAPITAL

AUTHORISED
5 000 ordinary par value shares of R1 each 5 5 5 5
Issued
1 914 ordinary par value shares of R1 each 2 2 2 2
Share premium 2 755 934 2 755 934 2 755 934 2 755 934
2 755 936 2 755 936 2 755 936 2 755 936
16. LOANS FROM SHAREHOLDER

CEF – 17 991 – 17 991
This unsecured US Dollar loan was
repayable in equal half-yearly instalments of
US$3 097 879 (R29 793 851) with a final
instalment of US$2 492 115 (R23 967 916)
due on 28 February 2010. Interest rate –
floating to LIBOR.
Non-current liabilities – – – –
Current liabilities – 17 991 – 17 991
– 17 991 – 17 991

17. PROVISIONS
RECONCILIATION OF
PROVISIONS:
GROUP – 2011
Utilised
Opening during Interest Change
balance Additions the year expense in estimate Total
R’000 R’000 R’000 R’000 R’000 R’000
Abandonment/Environment 3 565 595 1 737 – 419 969 1 518 956 5 506 257
Post-retirement medical aid
benefits 343 345 80 868 (280 625) – – 143 588
Rehabilitation provision 7 500 – – – – 7 500
Bonus 92 420 373 207 (110 025) – – 355 602
4 008 860 455 812 (390 650) 419 969 1 518 956 6 012 947
RECONCILIATION OF
PROVISIONS:
GROUP – 2010
Abandonment/Environment 3 600 400 30 178 – 292 273 (357 256) 3 565 595
benefits 300 230 45 287 (2 172) – – 343 345
Bonus 104 306 71 110 (82 996) – – 92 420
4 012 436 146 575 (85 168) 292 273 (357 256) 4 008 860
RECONCILIATION OF
PROVISIONS:
COMPANY – 2011
Abandonment/Environment 3 540 914 – – 419 969 1 518 956 5 479 839
benefits 343 345 80 868 (280 625) – – 143 588
Bonus 91 893 372 705 (109 497) – – 355 101
3 983 652 453 573 (390 122) 419 969 1 518 956 5 986 028
RECONCILIATION OF
PROVISIONS:
COMPANY – 2010
Abandonment/Environment 3 577 642 28 255 – 292 273 (357 256) 3 540 914
benefits 300 230 45 287 (2 172) – – 343 345
Bonus 104 306 70 583 (82 996) – – 91 893
3 989 678 144 125 (85 168) 292 273 (357 256) 3 983 652
Group Company
2011 2010 2011 2010
R’000 R’000 R’000 R’000
Non-current liabilities 5 649 819 3 913 618 5 623 427 3 888 901
Current liabilities 363 128 95 242 362 601 94 751
6 012 947 4 008 860 5 986 028 3 983 652
POST-RETIREMENT MEDICAL AID BENEFITS

The assumptions surrounding the provision were amended to be more aligned with the lifespan of the GTL
refinery. This change has resulted in a decrease in current year profits of R34 million (2012: R16 million).
PetroSA contributes to a medical aid scheme for retired and medically unfit employees.
REHABILITATION PROVISION
This amount is for the rehabilitation of the land at the Voorbaai terminal.

17. PROVISIONS (CONTINUED)
ABANDONMENT/ENVIRONMENT
The R5 480 million provided for is based on the present value of the results of a new study conducted in
2010. The new study indicated that the base cost of the provision would increase from R2 614 million to
R6 926 million, which resulted in a change in the provision estimate. The change to the abandonment
provision will result in a decrease in profits of R697 million in the current year (2012: R456 million; 2013:
R421 million; 2014: R394 million; 2015 – 2020: R1 349 million). Other major assumptions include the risk-
free rate decreasing from 9% to 8.3%, South African inflation and US inflation decreased from 6.5% to
5.5% and 3% to 1.5% respectively.
A sensitivity analysis indicates that an increase of 1% in the inflation and risk-free rates will result in a movement in
the interest charge and a change in estimate of the abandonment provision. The quantitative effect would be an
increase of R51.9 million (2010: R32.2 million) with respect to the inflation rate and an increase of R400.9 million
(2010: R189.4 million) for the risk-free rate.
The resulting provision could also be influenced by changing technologies and political, environmental, safety,
business and statutory considerations.
The total cost of future restoration costs is estimated at R10 339 million. This cost includes the gross
expenditure to abandon and to rehabilitate both the onshore and offshore facilities, as well as other related
closure costs. The costs are expected to be incurred as follows:
Financial year R’m

2012 455
2013 493
2014 1 168
2015 – 2034 8 223
BONUS
The provision is for incentives for PetroSA employees who qualify in terms of their individual as well as company
performance during the financial year.
18. TRADE AND OTHER PAYABLES

Group Company
2011 2010 2011 2010
R’000 R’000 R’000 R’000
Trade payables 931 859 976 923 933 302 969 505
VAT 6 621 – –
Accrued leave pay 60 200 61 240 59 670 60 191
Accrued expenses 515 791 421 609 492 557 272 795
Deposits received 22 – 22 –
Other payables 118 531 10 929 1 327 10 929
1 626 409 1 471 322 1 486 878 1 313 420
19. REVENUE
Gross revenue represents the invoiced value
of crude oil, fuel sales and other goods and
services supplied, excluding value added tax.
MAJOR CLASSES OF REVENUE COMPRISE

Fuel production sales 10 016 319 7 434 516 10 015 976 7 432 769
Crude oil sales 549 066 655 652 549 066 655 652
10 565 385 8 090 168 10 565 042 8 088 421

Group Company
2011 2010 2011 2010
R’000 R’000 R’000 R’000
20. OPERATING PROFIT (LOSS)
Operating profit (loss) profit for the year is
stated after accounting for the following:
INCOME FROM SUBSIDIARIES
Administration and management fees 323 369 2 238 14 756
OPERATING LEASE CHARGES
Premises
• Contractual amounts 5 820 4 340 2 426 1 927
Motor vehicles
• Contractual amounts 16 9 – –
Equipment
• Contractual amounts 49 38 – –
5 885 4 387 2 426 1 927
Bad debts recovered 2 282 1 006 2 282 1 006

Stock provision 3 030 72 180 3 030 72 180
Loss on foreign exchange 48 287 177 263 54 165 177 263
Impairment of accounts receivable 12 495 3 894 12 495 3 888
(Profit) loss on dissolution of subsidiary 2 612 – (1 723) –
Impairment/write-off on loans to Group
companies – 355 (36 693) 1 235 780
Amortisation on intangible assets 1 421 1 484 1 421 1 484
Depreciation on property, plant and equipment 1 238 593 751 774 1 236 700 749 801
Salaries and wages 855 770 825 269 839 129 810 789
Pension and medical costs 136 101 129 444 136 101 129 444
21. AUDITORS’ REMUNERATION

Audit fee 5 072 5 643 4 551 5 115
Expenses 62 228 62 33
5 134 5 871 4 613 5 148
22. INVESTMENT INCOME

DIVIDEND REVENUE
Dividends 1 – 1 723 –
INTEREST INCOME
Bank 15 284 – –
Investment 859 871 971 655 973 087 1 176 522
859 886 971 939 973 087 1 176 522
859 887 971 939 974 810 1 176 522
23. FINANCE COSTS

Non-current borrowings 89 1 395 89 1 122
Bank 2 472 17 318 2 472 17 318
Notional interest 419 969 292 273 419 969 292 273
Foreign exchange difference on revaluation of
foreign loans 4 86 546 – 86 546
422 534 397 532 422 530 397 259

Group Company
2011 2010 2011 2010
R’000 R’000 R’000 R’000
24. TAXATION
MAJOR COMPONENTS OF THE TAX
(INCOME) EXPENSE
Current
Local income tax – current period 779 – – –
Local income tax – recognised in current tax
for prior periods (386 526) (357 554) (386 468) (357 658)
Foreign income tax or withholding tax –
current period 4 687 328 1 092 –
Foreign income tax or withholding tax –
recognised in current tax for prior periods 62 427 – –
(380 998) (356 799) (385 376) (357 658)
Deferred
Benefit of unrecognised tax loss 317 890 189 721 317 890 190 041
Movement of deferred tax (245 411) (181 556) (245 412) (181 556)
72 479 8 165 72 478 8 485
(308 519) (348 634) (312 898) (349 173)
Reconciliation of the tax expense

Reconciliation between applicable tax rate and
average effective tax rate.
Applicable tax rate 28.00% (28.00%) 28.00% (28.00%)
Permanent differences (47.20%) 20.37% (36.47%) 31.31%
Utilisation of assessed losses 0% 0% 0% 0%
Foreign taxes 0.13% (0.11%) 0.09% 0%
Remeasurement of deferred tax – Tenth
Schedule 0% (2.46%) 0% (2.46%)
Assessed loss not recognised 6.34% 0% 11.71% 0%
Over accrual for previous tax year (48.83%) (35.66%) (36.00%) (35.66%)
(61.56%) (45.86%) (32.67%) (34.81%)
The Tax Amendment Act promulgated in November 2010, retrospectively inserted a new paragraph into the
Tenth Schedule which allows for the deduction of PetroSA’s unredeemed capital expenditure balance, carried
forward from the OP26 regime, a legislative predecessor to the Tenth Schedule. The effect of this amendment is
a deduction of R10.8 billion in 2008. Upon reopening of PetroSA’s 2008 corporate tax return it is expected that
SARS will refund R385 million (PetroSA’s provisional tax payments in 2008) together with accumulated interest.
As a direct result of the unredeemed capital expenditure deduction claimed in 2008, PetroSA is in an assessed
loss position for 2011 and it is envisaged that in the foreseeable future PetroSA will remain in this position.
The unused tax loss for the year is R9.8 billion.

Group Company
2011 2010 2011 2010
R’000 R’000 R’000 R’000
25. CASH GENERATED FROM (USED IN)
OPERATIONS
Profit (loss) before taxation 501 155 (762 205) 957 664 (1 005 033)
ADJUSTMENTS FOR:
Depreciation and amortisation 902 091 707 492 900 198 705 519
Notional interest (419 969) (292 273) (419 969) (292 273)
Dividends received (1) – (1 723) –
Interest received (859 886) (971 939) (973 087) (1 176 522)
Finance costs 422 534 397 532 422 530 397 259
Impairment loss (reversal) – 355 (36 693) 1 235 780
Movements in provisions 2 004 087 (3 576) 2 002 376 (6 026)
Movement in restoration costs (1 288 325) 60 532 (1 288 325) 60 532
Foreign exchange (gain) loss (111 753) (192 843) (77 501) (55 370)
Transfer of property, plant and equipment – 53 436 – 53 436
CHANGES IN WORKING CAPITAL
(Increase) decrease in inventories (160 076) 89 762 (157 683) 46 561
(Increase) decrease in trade and other
receivables (281 977) 190 324 (317 321) 181 022
(Decrease) increase in trade and other payables 155 087 (346 480) 173 458 (353 422)
862 967 (1 069 883) 1 183 924 (208 537)
26. DIVIDENDS PAID

Balance at the beginning of the year – (375 000) – (375 000)
Dividends – – – –
Balance at the end of the year – – – –
– (375 000) – (375 000)
27. TAX REFUNDED (PAID)

Charge to profit and loss 308 519 348 634 312 897 349 173
Movement in deferred taxation 72 765 8 200 72 478 8 486
Movement in taxation balance (123 748) (368 263) (128 306) (366 974)
(PAYMENTS MADE) AMOUNTS REFUNDED 257 536 (11 429) 257 069 (9 315)

Group Company
2011 2010 2011 2010
R’000 R’000 R’000 R’000
28. CASH FLOWS OF HELD FOR SALE/
DISCONTINUED OPERATIONS
Non-current assets held for sale (179 586) 1 064 116 – –
Liabilities of disposal groups 191 526 (617 758) – –
Profit from discontinuing operations 21 681 57 120 – –
33 621 503 478 – –
29. GOVERNMENT GRANTS

RECEIVABLE
PetroSA receives a government grant for
training on projects. In terms of the signed
agreement, PetroSA will receive a refund
based on the cost incurred in order to provide
specialised training on the project.
Grants received 3 469 3 720 3 469 3 720
30. EMPLOYEE BENEFITS

It is the policy of the Group to provide retirement benefits for all its eligible permanent employees. All eligible
permanent employees are either members of the Mossgas Pension Fund, a defined benefit fund, or PetroSA
Retirement Fund, a defined contribution fund, both subject to the Pension Funds Act No. 24 of 1956.
PENSIONS AND RETIREMENT FUNDS
Defined benefit pension plan
The Company operated a defined benefit pension plan for the benefit of employees. The plan was governed
by the Pension Funds Act No. 24 of 1956. The assets of the plan were administered by trustees in a fund
independent of the Company.
The Mossgas Pension Fund was closed to new entrants during 1996. With effect from 1 October 2007 all
in-service members were transferred out of the fund to the PetroSA Retirement Fund, and future accrual of
benefits under the pension fund ceased. Application was made to the Registrar to transfer the accrued benefits
of in-service members to the PetroSA Retirement Fund, and to transfer the pensioner liabilities to individual
annuity policies with Old Mutual. The Registrar's approval was granted and all liabilities have been fully
transferred. The trustees have appointed a liquidator, the Registrar approved of this appointment and the fund
was placed into liquidation in October 2010.
The last actuarial valuation was performed as at 31 January 2010 and the independent actuary was of the
opinion that the fund was financially sound. As the fund as been placed into liquidation, the actuarial present
value of promised retirement benefits as at 31 January 2010 was zero. The fair value of the plan assets had an
actuarial value of R12.2 million and a market value of R12.2 million as at 31 January 2010, which also equates
to the actuarial surplus. The Fund was valued using the “attained age method”.
Defined contribution pension plan
PetroSA Retirement Fund
The Company operates a defined contribution retirement plan for the benefit of employees who are not
members of the Mossgas Pension Fund. All employees who commenced employment after 1 April 1996
qualify for membership of this fund. The amount recognised as an expense during the year under review was
R81.9 million (2010: R78.1 million) for the retirement fund.

30. EMPLOYEE BENEFITS (CONTINUED)

MEDICAL BENEFITS
Post-employment medical benefits
The Group has provided an amount of R143.6 million (2010: R343.3 million) towards the funding of post-
retirement medical scheme costs for all employees and pensioners. This commitment is actuarially valued
annually, the most recent valuation performed as at 31 March 2011.
During the year, PetroSA offered in-service employees the opportunity to have their post-retirement medical
benefits transferred to the PetroSA retirement fund. The total liability transferred amounted to R280.6 million.
The actuarial present value of promised retirement medical benefits at 31 March 2011 is R143.6 million. The
obligation is unfunded and was valued using the projected unit credit method. A discount rate of 8.9% and
medical aid inflation rate of 7.0% was assumed. Mortality assumptions were in line with standard tables
SA56/62 (in service) and PA(90) (in retirement). A sensitivity analysis was performed on the medical aid inflation
rate assumption used in the valuation. An 8.0% and 6.0% medical aid inflation rate assumption would result in
an accumulated obligation at 31 March 2011 of R163.8 million and R126.7 million respectively.
The combined interest and service costs vary according to the medical aid inflation assumptions and are
R15.8 million (7.0%), R18.2 million (8.0%) and R13.8 million (6.0%).
Group Company
2011 2010 2011 2010
R’000 R’000 R’000 R’000
31. CONTINGENCIES
GUARANTEES
1. The Group has issued guarantees in favour
of financial institutions in respect of housing
loans granted by such institutions to
employees of the Group amounting to – 969 – 969
2. The Group’s share of 55% of costs being
US$3.356 million would be payable
from PetroSA’s share of revenues from
any future production within the E-P
tract should the tract be successful, thus
representing a contingent liability. 22 766 24 581 22 766 24 581
3. The Group has issued guarantees in favour
of a financial institution in respect of
vehicle loans granted by such institution to
employees of the Group amounting to – 957 – 957
4. The Group has issued guarantees for the
rehabilitation of land disturbed by mining
on the Sable field, amounting to 180 000 180 000 180 000 180 000
5. The Group has issued performance bonds
in favour of the Egyptian General Petroleum
Corporation in respect of minimum
work obligations required for exploration
operations in Egypt (US$17.7 million) – – – –
6. The Group has issued performance
guarantees in favour of the Republic of
Equatorial Guinea in respect of minimum
work obligations required for exploration
in Equatorial Guinea (US$18 million) 122 107 131 841 122 107 131 841
7. The Group has issued a parent company
guarantee in favour of Aban Abraham
in respect of rig hire for PetroSA
Equatorial Guinea for US$24.4 million
valid until 15 March 2010 – – – –

Group Company
2011 2010 2011 2010
R’000 R’000 R’000 R’000
31. CONTINGENCIES (CONTINUED)
GUARANTEES (CONTINUED)
8. The Group has issued a manufacture
and excisable bond in favour of the
South African Revenue Services 5 000 5 000 5 000 5 000
9. The Group has issued an evergreen VAT
guarantee in favour of the Dutch VAT
Authorities (€0.455 million) 4 386 4 482 4 386 4 482
11. A bank guarantee of LE96 000 for the
leasing of land at Marsa Marina was
issued by PetroSA Egypt (Pty) Limited – 480 – –
12. A bank guarantee of LE250 000 for the
leasing of the jetty at Marsa Marina was
issued by PetroSA Egypt (Pty) Limited – 7 – –
13. The Group has issued a stand-by letter of
credit in favour of Heraeus, Germany, for
the loan of platinum for US$2.5 million
valid until 30 April 2010 – 18 311 – 18 311
334 259 366 628 334 259 366 141
CLAIMS
PetroSA is considering settling a claim made by
a former employee 1 092 600 1 092 600
PetroSA is considering settling a claim made in
terms of a contract 13 225 – 13 225 –
14 317 600 14 317 600

Group Company
2011 2010 2011 2010
R’000 R’000 R’000 R’000
32. COMMITMENTS
AUTHORISED CAPITAL EXPENDITURE
Approved by the directors
Contracted for 1 924 174 2 321 129 1 924 174 2 321 129
Not contracted for 9 814 029 1 049 859 9 814 029 1 049 859
11 738 203 3 370 988 11 738 203 3 370 988
OPERATING LEASE COMMITMENTS

PetroSA
– within one year 443 2 465 443 2 465
– in second to fifth years inclusive – 416 – 416
443 2 881 443 2 881
Office space was leased at the Tyger Valley
Chambers in Parow, Cape Town, effective from
1 June 2008. The lease payment was fixed at
R178 345 per month, with an 8% escalation
per annum.The period of the lease agreement
is three years and ends on 31 May 2011.
PetroSA Europe BV – office space
– within one year 470 264 – –
– in second to fifth years inclusive 1 253 967 – –
1 723 1 231 – –
Office space was leased at 3011XB
Willemswerf, 13th Floor, Boomjes, effective
1 December 2004. The lease payment is
€40 960 per annum, with an inflationary
escalation per annum. The period of the lease
agreement was initially for five years and was
extended for a further five-year period ending
on 30 November 2014, at which time PetroSA
Europe BV has the option to renew the lease
for a further five year period.
PetroSA Europe BV – motor vehicles
– in second to fifth years inclusive 265 403 – –
518 645 – –
Motor vehicles are leased on behalf of the company’s employees. The standard contract period is 48 months.
The expiry dates are 18 January 2013 and 27 May 2013.

Group Company
2011 2010 2011 2010
R’000 R’000 R’000 R’000
32. COMMITMENTS (CONTINUED)
PetroSA Europe BV – apartments
– in second to fifth years inclusive – 622 – –
535 1 349 – –
Apartments are leased for its employees. There
are currently two apartment leases. One is
operated on a month-to-month basis with a
notice period of one month and the other is
renewable on a six-monthly basis with
1 May 2011 being the date of renewal. The
annual rental will be adjusted in line with
CPI – all household series.
Equatorial Guinea
Office space was leased in Malabo for a two-
year period, effective from 1 February 2011
to 31 January 2012. The lease payments are
CFA4 000 000 per month and were paid in
advance for a year.
Equatorial Guinea
– within one year – 321 – –
The Company entered into lease agreements
for staff accommodation for two employees,
effective until 14 May 2010 and 31 August 2010,
payable monthly in advance.
PetroSA Egypt
– within one year 184 1 070 – –
– in second to fifth years inclusive 148 – – –
332 1 070 – –
Office space was leased for employees in
Cairo. The lease has a three-year period from
1 January 2010 to 31 December 2012 with a
monthly lease payment of U$2 000, payable
six months in advance. The lease payments
will escalate annually on 1 January by 10%.
PetroSA North America
– within one year – 335 – –
– in second to fifth years inclusive – – – –
– 335 – –
Office space was leased at Lyric Centre Office Building, 440 Louisiana Street, Houston, Harris County, Texas, 77002.
The effective starting date was 1 December 2007 and the lease period is 36 months with a monthly payment of
US$4 251.99 and US$4 425.99 and an escalation of 0.692% linked to the increase in taxes, operating expenses
and utility costs.

33. FINANCIAL INSTRUMENTS

INTRODUCTION
The Group has a risk management and central treasury function that manages the financial risks relating to
the Group’s operations. The Group’s liquidity, credit, foreign exchange, interest rate and crude oil price risks are
monitored continually. Approved policies exist for managing these risks.
RISK PROFILE
In the course of the Group’s business operations it is exposed to liquidity, credit, foreign exchange, interest rate
and crude oil price risk. The risk management policy of the Group relating to each of these risks is discussed
below.
RISK MANAGEMENT OBJECTIVES AND POLICIES
The Group’s objective in using financial instruments is to reduce the uncertainty over future cash flows arising
from movements in foreign exchange, interest rates and crude oil prices. Throughout the year under review it
has been, and remains, the Group’s policy that no speculative trading in derivative instruments be undertaken.
FOREIGN CURRENCY MANAGEMENT
The Group is exposed to foreign currency fluctuations as it raises funding on the offshore financial markets,
imports raw material and spares, and furthermore exports finished product and crude oil. All local sales of
finished products are sold on a foreign currency denominated basis.
The Group takes cover on foreign exchange transactions where there is a future currency exposure. The Group
also makes use of a natural hedge situation to manage foreign currency exposure.
A sensitivity analysis was done for the net effect on revenue and expenses, and the weakening or
strengthening of the Rand/Dollar exchange rate by R1 based on actual revenue and cost will increase or
decrease profit by R885.4 million (2010: R585.3 million) respectively.
FOREIGN CURRENCY INSTRUMENTS
The Group is mainly exposed to fluctuation in the Euro, GBP and USD. The Group measures its market risk
exposure by running various sensitivity analyses including 10% favourable and adverse changes in the key
variables. The sensitivity analyses include only outstanding foreign currency denominated monetary items and
adjusts their translation at the period-end for a 10% change in foreign currency rates.
FINANCIAL ASSETS
As at 31 March 2011 a 10% strengthening in ZAR against the relevant currencies would have resulted
in a decrease in foreign currency denominated assets of R122.5 million (2010: R152.0 million) and a 10%
weakening in ZAR against the relevant currencies would have resulted in an increase in foreign currency
denominated assets of R122.5 million (2010: R152.0 million).
FINANCIAL LIABILITIES
As at 31 March 2011 a 10% strengthening in ZAR against the US Dollar would have resulted in a decrease in
foreign currency denominated liabilities of R15.6 million (2010: R20.7 million) and a 10% weakening in ZAR
against the US Dollar would have resulted in an increase in foreign currency denominated liabilities of
R15.6 million (2010: R20.7 million).
CURRENCY RISK
The Company has entered into certain forward exchange contracts which do not relate to specific items
appearing on the statement of financial position but which were entered into to cover foreign commitments
not yet due and proceeds not yet received. The contracts will be utilised for purposes of trade.

2011 2010 2009
33. FINANCIAL INSTRUMENTS (CONTINUED)
CURRENCY RISK (CONTINUED)
Exchange rates used for conversion of foreign items were:
CLOSING RATE:
USD 6.7837 7.3245 9.6175
Euro 9.6403 9.8511 12.8510
AVERAGE:
USD 7.1948 7.81366 8.33012
Euro 9.5031 11.04319 12.7700
FORWARD FOREIGN EXCHANGE CONTRACTS

2011
Total foreign currency Average forward exchange rate Maturity date
Liability
US$2 186 184 6.7837 Less than three months
2010
Total foreign currency
Liabilities
GBP3 389 11.1007 Less than three months
As at 31 March 2011, a 10% relative change in the USD to the ZAR would have impacted profit and loss for
the year by R1.5 million (2010: R0 million).
As at 31 March 2011, a 10% relative change in the GBP to the ZAR would have impacted profit and loss for the
year by R0 million (2010: R0.004 million).
Estimated fair value

Fair value loss/(gain)
2011 2010 2011 2010
R’000 R’000 R’000 R’000
Forward exchange contracts – assets – – – –
Forward exchange contracts – liabilities (14 830) (37) 170 –
(14 830) (37) 170 –
CREDIT RISK
Financial assets, which potentially subject the Group to concentrations of credit risk, pertain principally to trade
receivables and investments in the South African money market. Trade receivables are presented net of the
allowance for doubtful debts.
The exposure to credit risk with respect to trade receivables is not concentrated due to a large customer base.
The Group manages counterparty exposures arising from money market and derivative financial instruments
by only dealing with well-established financial institutions of a high credit rating. Losses are not expected as a
result of non-performance by these counterparties.
Credit limits with financial institutions are revised and approved by the Board quarterly.


CROSS CURRENCY INTEREST RATE SWAP
Set out below is the mark-to-market (MTM) valuation of the interest and foreign exchange portion of the cross
currency interest rate swap.
2011 2010 2011 2010
R’000 R’000 R’000 R’000
Financial assets
Assets from foreign exchange portion – – – –
Financial liabilities
Liabilities from foreign exchange portion – – – (895)
Liabilities from interest portion – – – (226)
As at 31 March 2011, no interest rate and foreign exchange derivative position relating to the cross currency
interest rate swaps existed (2010: out-of-the-money amounts to R1.1 million).
MATURITY PROFILE
The maturity profiles of financial assets and liabilities at the reporting date are as follows:
Less than Between one Over five Non-interest
one year and five years years bearing Total
R’000 R’000 R’000 R’000 R’000
Group
At 31 March 2011
Assets
Cash 11 852 498 – – – 11 852 498
Loans receivable – – 86 608 30 367 116 975
Trade and other receivables 2 070 344 – – – 2 070 344
Total financial assets 13 922 842 – 86 608 30 367 14 039 817
Liabilities
Trade and other payables 1 626 409 – – – 1 626 409
At 31 March 2010
Assets
Cash 10 027 026 – – – 10 027 026
Liabilities
Interest-bearing borrowings 17 991 – – – 17 991
Bank overdrafts 119 426 – – – 119 426
Total financial liabilities 1 608 739 – – – 1 608 739

MATURITY PROFILE (CONTINUED)
Less than Between one Over five Non-interest
one year and five years years bearing Total
R’000 R’000 R’000 R’000 R’000
Company
At 31 March 2011
Assets
Cash 11 795 852 – – – 11 795 852
Loans receivable – – 1 293 288 30 367 1 323 655
Total financial assets 13 868 036 – 1 293 288 30 367 15 191 691
Liabilities
At 31 March 2010
Assets
Cash 9 979 415 – – – 9 979 415
Liabilities
Interest-bearing borrowings 17 991 – – – 17 991
Bank overdrafts 119 426 – – – 119 426
Total financial liabilities 1 450 837 – – – 1 450 837
LIQUIDITY RISK
The Group manages liquidity risk by monitoring forecast cash flows and ensuring that adequate cash resources
are available to meet cash commitments.
PRICE RISK
External sales and purchases are subject to price and basis risks associated with volume and timing differences.


PRICE RISK (CONTINUED)
Price risk is mitigated using various operational and financial instruments. Instruments used are liquid and can
be traded and valued at any time. The hedge portfolio may consist of exchange-traded options and futures
as well as non-exotic over the counter options and swaps. Options, however, are only traded within zero cost
collars. The selling prices are hedged using the International Petroleum Exchange (IPE), New York Mercantile
Exchange (Nymex), or Singapore Monetary Exchange (Simex).
A sensitivity analysis was performed for revenue and every $1 increase or decrease in the Brent crude oil price
will increase or decrease profit by R65.0 million (2010: R55.8 million) respectively, based on the 2010/2011
financial results.
INTEREST RATE RISK

Exposure to interest rate risk on liabilities and investments is monitored on a proactive basis. The financing of
the Group is structured on a combination of floating and fixed interest rates.
The following table sets out the carrying amount, by maturity, of the Group’s financial instruments that are
exposed to interest rate risk and the effective interest rates applicable:
Between
one
Less than and five Over five
one year years years Total
R’000 R’000 R’000 R’000
At 31 March 2011
Fixed rate
Cash and cash equivalents (6.25%) 7 342 824 – – 7 342 824
Cash on deposit (5.57%) 489 021 – – 489 021
Floating rate
Cash and cash equivalents (7.50%) 3 103 027 1 350 000 – 4 453 027
Trade and other receivables 2 072 184 – – 2 072 184
Trade and other payables (1 486 878) – – (1 486 878)
Lürgi (4.24%) – – 86 608 86 608
PetroSA Egypt (11%) – – 945 158 945 158
GTL.F1 AG (0%) – – 30 367 30 367
PetroSA Equatorial Guinea (11%) – – 1 206 680 1 206 680
At 31 March 2010
Fixed rate
Cash and cash equivalents (7.76%) 2 951 199 – – 2 951 199
Cash on deposit (7.09%) 537 648 – – 537 648
Floating rate
Cash and cash equivalents (8.03%) 5 558 804 1 350 000 – 6 908 804
Bank overdraft (1.22%) 119 426 – – 119 426
Foreign loan – USD (0.92%) (17 991) – – (17 991)
Trade and other receivables 1 754 863 – – 1 754 863
Trade and other payables (1 313 420) – – (1 313 420)
PetroSA Gryphon Marin (12%) – – 261 341 261 341
Lürgi (3.63%) – – 104 371 104 371
PetroSA Egypt (12%) – – 990 351 990 351
PetroSA North America (2.92%) – – 949 949
GTL.F1 AG (0%) – – 31 031 31 031
PetroSA Equatorial Guinea (12%) – – 759 980 759 980

INTEREST RATE INSTRUMENTS
The Group is mainly exposed to fluctuation in USD LIBOR, EURIBOR and ZAR interest rates. The Group measures
its interest rate risk exposure by running various sensitivity analyses including 10% favourable and adverse
changes in the key variables. The sensitivity analyses include only interest-bearing monetary items and adjusts
their value at the period-end for a 10% change in interest rates.
FINANCIAL ASSETS
As at 31 March 2011 a 10% relative change in the:
• ZAR interest rate would have impacted profit and loss for the year by R90 million (2010: R89 million)
• EURIBOR interest rate would have impacted profit and loss for the year by R0.38 million (2010: R0.39 million)
• USD LIBOR interest rate would have impacted profit and loss for the year by R0 million (2010: R0.002 million)
FINANCIAL LIABILITIES
As at 31 March 2011 a 10% relative change in the USD LIBOR interest rate would have impacted profit and loss
for the year by R0 million (2010: R0.016 million; 2009: R0.26 million).
MARKET RISK
The Group’s activities expose it primarily to the financial risks of changes in commodity prices and foreign
currency exchange rates. Refer to note 33 for foreign currency risk management and price risk management.
34. FINANCIAL ASSETS BY CATEGORY

The accounting policies for financial instruments have been applied to the line items below:
Fair value
through
profit
Loans and or loss – Total
receivables designated R’000
GROUP – 2011
Loans receivable – 116 975 116 975
Other financial assets 489 021 – 489 021
Trade and other receivables 2 070 344 – 2 070 344
Cash and cash equivalents 11 852 498 – 11 852 498
14 411 863 116 975 14 528 838
GROUP – 2010
12 353 041 135 402 12 488 443

34. FINANCIAL ASSETS BY CATEGORY (CONTINUED)

Fair value
through
profit
Loans and or loss – Total
receivables designated R’000
COMPANY – 2011
Loans receivable – 1 323 655 1 323 655
14 357 057 1 323 655 15 680 712
COMPANY – 2010
12 271 926 896 330 13 168 256
35. FINANCIAL LIABILITIES BY CATEGORY

The accounting policies for financial instruments have been applied to the line items below:
Fair value
Financial Fair value through
liabilities at through profit profit
amortised or loss – held or loss –
cost for trading designated Total
R’000 R’000 R’000 R’000
GROUP – 2011
Trade and other payables 1 626 409 – – 1 626 409
GROUP – 2010
COMPANY – 2011
COMPANY – 2010

36. DIRECTORS’ EMOLUMENTS
Bonuses
and Compen-
perform- Pension Other sation
Salary/ ance contri- contri- for loss
Fee payments butions butions Expenses of office Other Total
R’000 R’000 R’000 R’000 R’000 R’000 R’000 R’000
YEAR ENDED
31 MARCH 2011
Executive
directors
S Mkhize 1 708 – 112 57 – – – 1 877
N Nika 2 244 461 262 151 – – – 3 118
Total 3 952 461 374 208 – – – 4 995
Non-executive
directors
Adv. L Makatini 670 – – – 236 – – 906
PS Molefe 165 – – – 22 – – 187
MB Damane – – – – 59 – – 59
Prof. B Figaji 211 – – – 7 – – 218
DR Zihlangu 604 – – – 198 – – 802
M Kajee 452 – – – 25 – – 477
BB Siwisa 78 – – – 18 – – 96
MW Mkhize – – – – 55 – – 55
ZR Rustomjee 378 – – – 78 – – 456
Z Mavuso – – – – 63 – – 63
YR Tenza 377 – – – 129 – – 506
N Medupe 290 – – – 78 – – 368
Total 3 225 – – – 968 – – 4 193
Bonuses
and Compen- Expatri-
perform- Pension Other sation ate
Salary/ ance contri- contri- Acting for loss allow-
Fee payments butions butions allowance of office ance Total
R’000 R’000 R’000 R’000 R’000 R’000 R’000 R’000
Executive
Management
E September 1 722 230 295 123 – – – 2 370
N Siswana 2 046 278 133 68 15 – – 2 540
G Sweto 1 699 240 113 96 – – – 2 148
JEP Falbe 2 104 373 145 200 – – 604 3 426
D Arendse 1 575 165 180 84 – – – 2 004
Total 9 146 1 286 866 571 15 – 604 12 488

36. DIRECTORS' EMOLUMENTS (CONTINUED)

Bonuses
and Compen-
perform- Pension Other sation
Salary/ ance contri- contri- for loss
Fee payments butions butions Expenses of office Other Total
R’000 R’000 R’000 R’000 R’000 R’000 R’000 R’000
YEAR ENDED
31 MARCH 2010
Executive
directors
S Mkhize 3 908 410 256 132 – – – 4 706
N Nika 2 087 433 243 137 – – – 2 900
Total 5 995 843 499 269 – – – 7 606
Non-executive
directors
PS Molefe 535 – – – 159 – – 694
Prof. B Figaji 405 – – – 38 – – 443
BB Siwisa 355 – – 57 – – 412
N Vukuza-Linda 36 – – – 7 – – 43
DR Zihlangu 505 – – – 120 – – 625
MW Mkhize – – – – 80 – – 80
MB Damane – – – – 95 – – 95
YR Tenza 208 – – – 45 – – 253
Z Mavuso – – – – 26 – – 26
M Kajee 502 – – 58 – – 560
CWN Molope 198 – – – 31 – – 229
ZR Rustomjee 202 – – – 38 – – 240
N Medupe 80 – – – 15 – – 95
A Nkuhlu 116 – – – 48 – – 164
L Makatini 50 – – – 15 – – 65
Total 3 192 – – – 832 – – 4 024
Payment
Bonuses for con-
and version to Compen- Expatri-
perform- Pension Other fixed- sation ate
Salary/ ance contri- contri- term for loss allow-
Fee payments butions butions contracts of office ance Total
R’000 R’000 R’000 R’000 R’000 R’000 R’000 R’000
Executive
management
D Marokane 1 294 216 137 149 – – – 1 796
E September 1 574 307 216 134 1 766 – – 3 997
N Siswana 1 903 307 124 65 – – – 2 399
G Sweto 1 395 245 93 95 – – – 1 828
JEP Falbe 2 505 254 134 193 – – 560 3 646
D Arendse 1 179 – 149 96 – – – 1 424
Total 9 850 1 329 853 732 1 766 – 560 15 090

Group Company
2011 2010 2011 2010
R’000 R’000 R’000 R’000
37. RELATED PARTIES
RELATED PARTY TRANSACTIONS
CEF (Pty) Limited
Dividends declared – 375 000 – 375 000
Cash on call 489 021 537 648 489 021 537 648
Interest paid 89 1 122 89 1 122
Services received 119 – 119 –
Interest received 28 904 38 208 28 904 38 208
Amounts owing – 17 991 – 17 991
Recoveries 416 397 416 397
Trade receivables – 38 – 38
Trade payable 25 260 25 260
PASA
Services received 398 978 398 978
Royalties paid 64 237 50 648 64 237 50 648
Rentals received – 913 – 913
Trade payable 18 642 12 456 18 642 12 456
SFF
Trade payable 8 676 – 8 676 –
Trade receivables – 16 203 – 16 203
Management fee – 2 076 – 2 076
Recoveries 6 622 66 747 6 622 66 747
Transfer of assets 988 – 988 –
Subsidiaries
Loan to – – 2 153 751 2 012 750
Loan impairment – – 945 198 1 251 693
Loans owing – – 1 1
Management fee – – 4 262 14 387
Recoveries – – 5 992 8 643
Loan written off – – 269 841 –
Interest received – – 114 979 220 903
Commission paid – – 33 387 20 933
Dividend received – – 1 723 –
Trade receivable – – 5 947 7 942
Trade payable – – 4 023 6 253
OPCSA
Trade payables – 1 104 – 1 104
Recoveries 968 9 254 968 9 254
SAA
Services received/rendered 12 350 8 427 12 350 8 427
SABC
Services received/rendered 40 18 40 18
Airports Company

Group Company
2011 2010 2011 2010
R’000 R’000 R’000 R’000
37. RELATED PARTIES (CONTINUED)
Eskom Group
Product 410 167 75 651 410 167 75 651
Rental 599 744 599 744
Storage 29 400 24 411 29 400 24 411
Trade receivable 32 055 159 32 055 159
Telkom
SARS
Payments 3 409 160 2 622 342 3 409 160 2 622 342
Tuinroete Agri

38. INTEREST IN JOINT OPERATING AGREEMENTS
The Group’s proportionate share in the assets and liabilities of unincorporated joint ventures, which are included
in the financial statements are as follows:
Percentage holding/tracts
55%
55% 55% 55% 55% 55% SCG
E-AA E-AG E-W E-CB E-CN Explore
2011
R’000
Current assets 188 73 499 583 810 238
Total assets 188 73 499 583 810 238
Current liabilities 156 27 200 381 270 214

Retained income (1 147) (807) (2 052) (28 668) (2 233) (53 256)
Company
contribution to
venture 1 179 853 2 351 28 870 2 773 53 280
Total liabilities 188 73 499 583 810 238
Revenue 8 2 13 11 7 4
Expenses (308) (92) (752) (820) (620) (468)
Net profit (loss) (300) (90) (739) (809) (613) (464)
Partners: Pioneer Pioneer Pioneer Pioneer Pioneer Pioneer

45% 45% 45% 45% 45% 45%
Nature of project Exploration Exploration Exploration Exploration Exploration Exploration
55% 55% SCG 55% 60% 24% 24%
E-CC Capex E-P Sable Block 2A Block 2C
2011
R’000
Current assets 90 998 – 45 935 54 793 –
Total assets 90 998 – 45 935 54 793 –
Current liabilities 39 – – – – –
Retained income (125 916) (2 039 455) (39 965) (1 441 585) (184 503) (10 091)
Company
contribution to
venture 125 967 2 040 453 39 965 1 487 520 239 296 10 091
Total liabilities 90 998 – 45 935 54 793 –
Revenue 6 7 032 – 145 – –

Expenses (106) – (176) (5 273) (5 716) (710)
Net profit (loss) (100) 7 032 (176) (5 128) (5 716) (710)
Partners: Anschutz Anschutz
22.80% 22.80%
Pioneer Pioneer Pioneer Pioneer Forest Forest
45% 45% 45% 40% 53.20% 53.20%

38. INTEREST IN JOINT OPERATING AGREEMENTS (CONTINUED)

30% 10% 10% 10%
55% Block 55% Namibia Namibia Namibia
F-Q 3A/4A E-DC South North 1711
2011
R’000
Retained income (3 486) (3 675) (44 502) (18 699) (1 983) (112 209)
Company contribution
to venture 3 486 3 675 44 502 18 699 1 983 112 209
Total liabilities – – – – – –
Expenses (2 102) (1 536) (176) – – –
Partners: Nakor
70%
Energulf
10%
BHP Billiton BHP Billiton BHP Billiton Namcor
60% 75% 75% 7%
Pioneer Sasol Pioneer Mitsui Mitsui Kunene
45% 10% 45% 15% 15% Energy 3%
25.5%
Zambezi
Block
2011
R’000
Retained income (183 926)
to venture 183 926
Total liabilities –
Partners: Petronas
42.50%
ENH
15%
Petrobras
17%
Nature of project Exploration

55%
55% 55% 55% 55% 55% E-DC
E-AA E-AG E-W E-CB E-CN Explore
2010
R’000
Current assets 202 46 268 335 143 18
Current liabilities 5 2 185 211 9 –

Retained income (914) (774) (1 418) (30 079) (1 749) (57 000)
to venture 1 111 818 1 501 30 203 1 883 57 018
Total liabilities 202 46 268 335 143 18
Revenue 9 3 22 28 7 35
Expenses (189) (79) (1 377) (1 748) (326) –
Net profit (loss) (180) (76) (1 355) (1 720) (319) 35
Partners: Pioneer Pioneer Pioneer Pioneer Pioneer Pioneer

45% 45% 45% 45% 45% 45%
55%
55% SCG 55% 60% 24% 24%
E-CC Capex E-P Sable Block 2A Block 2C
2010
R’000
Current assets 166 998 – 72 703 54 793 –
Current liabilities 3 – – 16 700 – –

Retained income (135 846) (2 039 455) (39 789) (1 544 678) (178 787) (9 381)
to venture 136 009 2 040 453 39 789 1 600 681 233 580 9 381
Total liabilities 166 998 – 72 703 54 793 –
Revenue 35 7 032 – – – –
Expenses (28) – (3 256) 8 006 (5 789) (504)
Net profit (loss) 7 7 032 (3 256) 8 006 (5 789) (504)
Partners: Anschutz Anschutz

22.8% 22.8%
Pioneer Pioneer Pioneer Pioneer Forest Forest
45% 45% 45% 40% 53.2% 53.2%
Nature of project Exploration Exploration Exploration Production Exploration Exploration

38. INTEREST IN JOINT OPERATING AGREEMENTS (CONTINUED)

30% 10% 10% 10%
55% Block 55% Namibia Namibia Namibia
F-Q 3A/4A E-DC South North 1711
2010
R’000
Retained income (1 384) (2 139) (44 326) (18 699) (1 983) (122 209)
to venture 1 384 2 139 44 326 18 699 1 983 122 209
Total liabilities – – – – – –
Expenses (203) (211) (143) (263) (188) (2 490)

Net profit (loss) (203) (211) (143) (263) (188) (2 490)
Partners: Nakor
70%
Energulf
10%
BHP BHP BHP Namcor
Billiton Billiton Billiton 7%
60% 75% 75% Kunene
Pioneer Sasol Pioneer Mitsui Mitsui Energy
45% 10% 45% 15% 15% 3%
22.50%
Zambezi
Block
2010
R’000
Production facilities 1
Retained income (183 926)
to venture 183 926
Total liabilities –
Expenses (11 844)

Net profit (loss) (11 844)
Partners: Petronas
42.5%
ENH
15%
Petrobras
17%
Nature of project Exploration

JOINT VENTURE WITH STATOIL ASA
The Company has entered into a 37.5% joint venture with Statoil ASA, the Norwegian State Oil company, and Lürgi
to develop GTL-Fisher Tröpsch technology and to explore and develop GTL opportunities in Iran and elsewhere. The
PetroSA share of assets amounts to R360 million (2010: R325 million) at year-end.
JOINT VENTURE WITH PIONEER
PetroSA has a production-sharing agreement with Pioneer for the South Coast gas field production. The holding
is 55:45 respectively.
Group Company
2011 2010 2011 2010
R’000 R’000 R’000 R’000
39. PUBLIC FINANCE MANAGEMENT
ACT (PFMA)
FRUITLESS AND WASTEFUL EXPENDITURE
Standing time of transport vehicles – 9 – 9
Flight missed – 2 – 2
Penalties and interest paid to tax authorities 20 718 13 133 4 323 13 133
Interest on late payment of invoices 96 26 96 26
Penalties and interest for late payment of
cargo dues 114 20 114 20
Penalties and interest on settlement of dispute – 1 960 – 1 960
Cancellation fee 1 – 1 –
Addition travel costs 4 – 4 –
Overpayment of vendor 22 – 22 –
Damage to outboard motors 228 – 228 –
Unauthorised event 25 – 25 –
Penalties and interest on CCMA award 77 – 77 –
Irrecoverable study assistance 31 – 31 –
Interest on late payment of investment 122 – 122 –
Penalties on outstanding cost recovery reports 67 – – –
Additional registration fees 114 154 – –
21 619 15 304 5 043 15 150
Refer to page 65 to 66 of the Directors’ Report
for further details. The appropriate corrective
and/or disciplinary actions have been taken
(where necessary).
FRUITLESS AND WASTEFUL EXPENDITURE
MOVEMENT
Incurred during the year 21 619 15 304 5 043 15 150
Recovered during the year (12 977) – (12 977) –
Recognised as income (expense) during the
year (8 642) (15 304) 7 934 (15 150)
Closing balance – – – –
IRREGULAR EXPENDITURE
Contravention of Company policy 13 602 309 1 175 309
Contravention of legislation 3 350 – 3 350 –
16 952 309 4 525 309

Group Company
2011 2010 2011 2010
R’000 R’000 R’000 R’000
40. COMPARATIVE FIGURES
Certain comparative figures in the notes to the
Group annual financial statements have been
reclassified.
The effects of the reclassification are as
follows:
STATEMENT OF FINANCIAL POSITION
Sundry receivables (1 393 919) – (1 393 919) –
Trade payables 1 393 919 – 1 393 919 –
Accrued leave pay 956 – – –
Accrued expenses (956) – – –

FIELDS IN PRODUCTION AND UNDER DEVELOPMENT
Group Company
Crude oil/ Crude oil/
Condensate Condensate
MMbbl Gas Bscf MMbbl Gas Bscf
2011 2011 2010 2010
1. MOVEMENT IN NET REMAINING PROVED
AND PROBABLE RESERVES
At the beginning of the year 3.60 57.80 6.50 106.10
Revisions of previous estimates – – 0.60 (14.00)
Production (2.60) (45.00) (3.50) (34.30)
Additions 7.40 536.10 – –
At the end of the year 8.40 548.90 3.60 57.80
2. PROVED AND PROBABLE RESERVE BY TYPE

OF FIELD
Fields in production 8.40 298.90 3.60 57.80
Fields under development – 249.90 – –
8.40 548.80 3.60 57.80
3. RESERVES BY CATEGORY
Proved 5.22 399.90 1.60 34.10
Proved and probable 8.40 548.80 3.60 57.80
Total proved and probable reserves at the end of
the year 8.40 548.80 3.60 57.80
NOTES
Oil
Fields in production and under development comprise the Oribi (100%) and Oryx (100%) oil fields.
Gas
Fields in production and under development comprise the SCG (55%), F-A and F-A Satellite, E-M and E-M Satellite
and F-O gas fields respectively.
Fields under appraisal comprise discoveries. The reserves shown are either all oil or all gas, excluding gas liquids.
Oil includes condensate and LPG.
Reserves and production are shown on a working interest basis (100%).
Oil and gas reserves cannot be measured exactly since the estimation of reserves involves subjective judgement
and arbitrary determinations and therefore all estimations are subject to revision. The gas and oil reserves reflected
above have been determined by an independent surveyor.
DEFINITIONS
Proved reserves
Oil
Means the amount of petroleum which geophysical, geological and engineering data indicate to be commercially
recoverable to a high degree of certainty. For the purposes of this definition, there is a 90% chance that the actual
quantity will be more than the amount estimated as proved and a 10% chance that it will be less.
Gas
Means the amount of gas which geophysical, geological and engineering data indicate to be commercially
recoverable to a high degree of certainty. For the purposes of this definition, there is a 90% chance that the actual
quantity will be more than the amount estimated as proved and a 10% chance that it will be less.
The supplementary information presented does not form part of the annual financial statements and is unaudited

FIELDS IN PRODUCTION AND UNDER DEVELOPMENT (CONTINUED)
Proved and probable reserves

Oil
Means proved reserves plus the amount of petroleum which geophysical, geological and engineering data indicate
to be commercially recoverable but with a greater element of risk than in the case of proved. For the purposes of
this definition, there is a 50% chance that the actual quantity will be more than the amount estimated as proved
and probable and a 50% chance that it will be less.
Gas
Means proved reserves plus the amount of gas which geophysical, geological and engineering data indicate to be
commercially recoverable, but with a greater element of risk than in the case of proved. For the purposes of this
definition, there is a 50% chance that the actual quantity will be more than the amount estimated as proved and
probable and a 50% chance that it will be less.
Reserves under appraisal

Oil
Comprise quantities of petroleum, which are considered, on the basis of information currently available and
current economic forecasts, to be commercially recoverable by present producing methods from fields that have
been discovered but which require further appraisal prior to commerciality being established.
Gas
Comprise quantities of gas, which are considered, on the basis of information currently available and current
economic forecasts, to be commercially recoverable by present producing methods from fields that have been
discovered, but which require further appraisal prior to commerciality being established.

DEFINITION OF FINANCIAL TERMS
Below is a list of definitions of financial terms used in the CASH FLOW HEDGE
annual report of PetroSA (Pty) Limited and the Group:
A hedge of the exposure to variability in cash flows
ACCOUNTING POLICIES that is attributable to a particular risk associated with
an asset, or a liability that could affect profit or loss
The specific principles, bases, conventions, rules and
or a highly probable forecast transaction that could
practices applied in preparing and presenting annual
affect profit or loss.
financial statements.
CHANGE IN ACCOUNTING ESTIMATE
ACCRUAL ACCOUNTING
An adjustment to the carrying amount of an asset,
The effects of transactions and other events are
liability or the amount of the periodic consumption
recognised when they occur rather than when the
of an asset that results from new information or new
cash is received.
developments.
ACTUARIAL GAINS AND LOSSES CONSOLIDATED ANNUAL FINANCIAL

The effects of differences between the previous STATEMENTS
actuarial assumptions and what has actually occurred,
The annual financial statements of a Group presented
as well as changes in actuarial assumptions.
as those of a single economic entity.
AMORTISED COST CONTINGENT ASSET

The amount at which a financial asset or financial
A possible asset that arises from past events and
liability is measured at initial recognition, minus
whose existence will be confirmed only by the
principal repayments, plus or minus the cumulative
occurrence or non-occurrence of one or more
amortisation using the effective interest method
uncertain future events not wholly within the control
of any difference between that initial amount and
of the entity.
the maturity amount, and minus any reduction for
impairment or uncollectibility.
CONTINGENT LIABILITY
ASSET A possible obligation that arises from past events
and whose existence will be confirmed only by
A resource controlled by the entity as a result of a
the occurrence or non-occurrence of one or more
past event from which future economic benefits are
uncertain future events not wholly within the control
expected to flow.
of the entity, or a present obligation that arises from
past events but is not recognised because it is not
ASSOCIATE probable that an outflow of resources embodying
An entity over which the investor has significant economic benefits will be required to settle the
influence and that is neither a subsidiary nor an obligation, or the amount of the obligation cannot be
interest in a joint venture. Significant influence is the measured with sufficient reliability.
power to participate in the financial and operating
policy decisions of the associate but has no control or DATE OF TRANSACTION
joint control over those policies. The date on which the transaction first qualifies for
recognition in accordance with Generally Accepted
BORROWING COSTS Accounting Practice.
Interest and other costs incurred in connection with
the borrowing of funds. DEPRECIATION (OR AMORTISATION)
The systematic allocation of the depreciable amount
CARRYING AMOUNT of an asset over its useful life. The depreciable
The amount at which an asset is recognised amount of an asset is the cost of an asset, or other
after deducting any accumulated depreciation or amount substituted for cost, less its residual value.
amortisation and accumulated impairment losses.
DERECOGNITION
CASH AND CASH EQUIVALENTS The removal of a previously recognised asset or
Cash comprises cash on hand and demand liability from the statement of financial position.
deposits. Cash equivalents are short-term, highly
liquid investments that are readily convertible to DERIVATIVE
known amounts of cash and that are subject to an A financial instrument whose value changes in
insignificant risk of changes in value. response to an underlying item, requires no initial

DEFINITION OF FINANCIAL TERMS (CONTINUED)
or little net investment in relation to other types of FINANCE LEASE

contracts that would be expected to have a similar
A lease that transfers substantially all the risks and
response to changes in market factors and is settled rewards incidental to ownership of an asset. Title may
at a future date. or may not eventually be transferred.
DEVELOPMENT FINANCIAL ASSET OR LIABILITY AT FAIR

The application of research findings or other
VALUE THROUGH PROFIT OR LOSS
knowledge to a plan or design for the production
of new or substantially improved materials, devices, A financial asset or financial liability that is classified
as held for trading or is designated as such on
products, processes, systems or services before
initial recognition other than investments in equity
starting commercial production or use.
instruments that do not have a quoted market price
DISCONTINUED OPERATION in an active market and whose fair value cannot be
reliably measured.
A component that has either been disposed of
or is classified as held for sale and represents a
FINANCIAL INSTRUMENT
separate major line of business or geographical area
A contract that gives rise to a financial asset of one
of operations, or is part of a single co-ordinated
entity and a financial liability or equity instrument of
plan to dispose of a separate major line of business
another entity.
or geographical area of operation, or a subsidiary
acquired exclusively with a view to resale.
FINANCIAL RISK
The risk of a possible future change in one or more
EMPLOYEE BENEFITS
of a specified interest rate, financial instrument price,
All forms of consideration (excluding share options commodity price, foreign exchange rate, index of
granted to employees) given in exchange for services prices or rates, credit rating or credit index or other
rendered by employees. variable, provided in the case of a non-financial
variable that the variable is not specific to a party to
EQUITY INSTRUMENT the contract.
A contract or certificate that evidences a residual
interest in the total assets after deducting the total FIRM COMMITMENT
liabilities. A binding agreement for the exchange of a specified
quantity of resources at a specified price on a
EQUITY METHOD specified future date or dates.
A method in which the investment is initially
recognised at cost and adjusted thereafter for the
FORECAST TRANSACTION
post-acquisition change in the share of net assets of An uncommitted but anticipated future transaction.
the investee. Profit or loss includes the share of the
profit or loss of the investee. GOING CONCERN BASIS
The assumption that the entity will continue in
EXPENSES operation for the foreseeable future. When making
this assumption management assesses a period of
The decreases in economic benefits in the form of
twelve months from reporting date.
outflows or depletions of assets or incurrences of
liabilities that result in decreases in equity, other than
GROSS INVESTMENT IN LEASE
those relating to distributions to equity participants.
The aggregate of the minimum lease payments
receivable by the lessor under a finance lease and any
FAIR VALUE
unguaranteed residual value accruing to the lessor.
The amount for which an asset could be exchanged
or a liability settled, between knowledgeable and HEDGED ITEM
willing parties in an arm’s length transaction.
An asset, liability, firm commitment, highly probable
forecast transaction or net investment in a foreign
FAIR VALUE HEDGE operation that exposes the entity to risk of changes
A hedge of exposure to changes in fair value of a in fair value or future cash flows and is designated as
recognised asset, liability or firm commitment. being hedged.

HEDGING INSTRUMENT KEY MANAGEMENT PERSONNEL
A designated derivative or non-derivative financial asset Those persons having authority and responsibility for
or non-derivative financial liability whose fair value or planning, directing and controlling the activities of
cash flows are expected to off-set changes in the fair the entity. In terms of this definition, the members
value or cash flows of a designated hedged item. of the Board of Directors of PetroSA qualify as key
management personnel of the Group. In individual
HEDGE EFFECTIVENESS companies, the Board of Directors and Executive
The degree to which changes in the fair value or cash Management committees qualify.
flows of the hedged item that are attributable to a
hedged risk are off-set by changes in the fair value or LEGAL OBLIGATION
cash flows of the hedging instrument. An obligation that derives from a contract, legislation
or other operation of law.
HELD-FOR-TRADING FINANCIAL ASSET OR
FINANCIAL LIABILITY LIABILITY
One that is acquired or incurred principally for the A present obligation of the entity arising from a past
purpose of selling or repurchasing it in the near term or event, the settlement of which is expected to result
as part of a portfolio of identified financial instruments in an outflow from the entity of resources embodying
that are managed together and for which there is economic benefits.
evidence of a recent actual pattern of short-term profit-
taking or a derivative (except for a derivative that is a LOANS AND RECEIVABLES
designated and effective hedging instrument). Non-derivative financial assets with fixed or
determinable payments that are not quoted in an
HELD-TO-MATURITY INVESTMENT active market.
A non-derivative financial asset with fixed or
determinable payments and fixed maturity where MINIMUM LEASE PAYMENTS
there is a positive intention and ability to hold it to
Payments over the lease term that the lessee is or can
maturity.
be required to make, excluding contingent rent, costs
for services and taxes to be paid by and reimbursed
IMMATERIAL to the lessor including in the case of a lessee, any
If individually or collectively it would not influence amounts guaranteed by the lessee or by a party related
the economic decisions of the users of the annual to the lessee or in the case of a lessor, any residual
financial statements. value guaranteed to the lessor by the lessee, a party
related to the lessee or a third party unrelated to the
IMPAIRMENT LOSS lessor that is financially capable of discharging the
The amount by which the carrying amount of obligations under the guarantee.
an asset or a cash-generating unit exceeds its
recoverable amount. NET ASSETS
Net operating assets plus cash and cash equivalents.
IMPRACTICABLE
Applying a requirement is impracticable when the OPERATING LEASE
entity cannot apply it after making every reasonable Any lease other than a finance lease.
effort to do so.
OWNER-OCCUPIED PROPERTY
INCOME Property held by the owner or by the lessee under a
Increase in economic benefits in the form of inflows finance lease for use in the production or supply of
or enhancements of assets or decreases in liabilities goods or services or for administrative purposes.
that result in increases in equity, other than those
relating to contributions from equity participants. PAST SERVICE COST
The increase or decrease in the present value of the
JOINT VENTURE defined benefit obligation for employee service in
A contractual arrangement whereby two or more prior periods resulting from the introduction of, or
parties undertake an economic activity that is subject changes to, post-employment benefits or other long-
to joint control. term employee benefits.

DEFINITION OF FINANCIAL TERMS (CONTINUED)
POST-EMPLOYMENT BENEFITS deducting the estimated costs of disposal, if the

asset were already of the age and in the condition
Employee benefits (other than termination benefits)
expected at the end of its useful life.
that are payable after the completion of employment.
POST-EMPLOYMENT BENEFIT PLANS RESTRUCTURING

Formal or informal arrangements under which A programme that is planned and controlled by
an entity provides post-employment benefits to management, and materially changes either the
employees. Defined contribution benefit plans are scope of a business undertaken by an entity or the
where there are no legal or constructive obligations manner in which that business is conducted.
to pay further contributions if the fund does not hold
sufficient assets to pay all employee benefits relating RETROSPECTIVE APPLICATION
to employee service in the current and prior periods. Applying a new accounting policy to transactions,
Defined benefit plans are post-employment benefit
other events and conditions as if that policy had
plans other than defined contribution plans.
always been applied.
PRESENTATION CURRENCY RETROSPECTIVE RESTATEMENT

The currency in which the annual financial statements
Correcting the recognition, measurement and
are presented.
disclosure of amounts as if a prior period error had
never occurred.
PRIOR PERIOD ERROR
An omission from or misstatement in the annual TAX BASE
financial statements for one or more prior periods
The tax base of an asset is the amount that is
arising from a failure to use, or misuse of, reliable
deductible for tax purposes if the economic benefits
information that was available when annual financial
statements for those periods were authorised for from the asset are taxable or is the carrying amount
issue and could reasonably be expected to have been of the asset if the economic benefits are not taxable.
obtained and taken into account in the preparation The tax base of a liability is the carrying amount of
of those annual financial statements. the liability less the amount deductible in respect
of that liability in future periods. The tax base of
PROSPECTIVE APPLICATION revenue received in advance is the carrying amount
less any amount of the revenue that will not be taxed
Applying a new accounting policy to transactions,
in future periods.
other events and conditions occurring after the date
the policy changed or recognising the effect of the
change in an accounting estimate in the current and TEMPORARY DIFFERENCES
future periods. The differences between the carrying amount of an
asset or liability and its tax base.
RECOVERABLE AMOUNT
The higher of an asset’s or cash-generating unit’s fair TRANSACTION COSTS
value less costs to sell and its value in use. Incremental costs that are directly attributable to the
acquisition, issue or disposal of a financial asset or
RESEARCH financial liability, i.e. those that would not have been
The original and planned investigation undertaken incurred if the entity had not acquired, issued or
with the prospect of gaining new scientific or disposed of the financial instrument.
technical knowledge and understanding.
USEFUL LIFE
RESIDUAL VALUE The period over which an asset is expected to be available
The estimated amount which an entity would for use or the number of production or similar units
currently obtain from disposal of the asset, after expected to be obtained from the asset.

PetroSA 2011 Annual Report

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ANNUAL REPORT 2011

PetroSA 2011 ANNUAL REPORT

2011 2010 Total

Travel costs (includes accommodation)

Purchase of other World Cup apparel

Total 2010 World Cup expenditure 2 864 13 952 16 816

PetroSA ANNUAL REPORT 2011 137

Our Mission, Our Vision, Our Values 2

2 PetroSA ANNUAL REPORT 2011

PetroSA ANNUAL REPORT 2011 3

4 PetroSA ANNUAL REPORT 2011

PetroSA ANNUAL REPORT 2011 5

PRESIDENT AND CEO

CORPORATE SECRETARIAT INTERNAL AUDIT

OFFICE OF THE CEO RISK AND COMPLIANCE

The company structure comprises the Office of the CEO

6 PetroSA ANNUAL REPORT 2011

PetroSA ANNUAL REPORT 2011 7

Dr Benny AM Mokaba Mr Mputumi B

Mr Yekani R Tenza Mr Dalikhaya

Dr Zavareh Adv. Linda Makatini

Ms Nondumiso Ms Esther Letlape

8 PetroSA ANNUAL REPORT 2011

PetroSA ANNUAL REPORT 2011 9

10 PetroSA ANNUAL REPORT 2011

The 2010/2011 financial year provided a firm platform

12 PetroSA ANNUAL REPORT 2011

PetroSA ANNUAL REPORT 2011 13

Adv. Sindi V Ngaba

14 PetroSA ANNUAL REPORT 2011

PetroSA ANNUAL REPORT 2011 15

A company wide focus on cost control and capital

Timely Action to Prevent a Water Crisis at

net profit largest seawater desalination plant in Mossel Bay. This

Leveraging Relationships Through the

16 PetroSA ANNUAL REPORT 2011

PetroSA ANNUAL REPORT 2011 17

The focus remains on the acquisition of existing

Developing a Joint Business Plan in Venezuela

18 PetroSA ANNUAL REPORT 2011

The company remained committed and continued to support

PetroSA ANNUAL REPORT 2011 19

Key Performance Indicators

Total assets 25 006 21 991 14%

Year-end exchange rates

Average exchange rates

Nkosemntu G Nika Performance Review

20 PetroSA ANNUAL REPORT 2011

PetroSA ANNUAL REPORT 2011 21

Our Vision 2020 strategic

ENSURING THAT THE

22 PetroSA ANNUAL REPORT 2011

PetroSA’s priority is to ensure the short-, medium- and long-term

TOTAL 11.44 9.52 20%

GTL REFINERY (MMBOE) 7.15 5.30 35%

Non-feedstock Production Constant at

The Oribi and Oryx fields

PetroSA ANNUAL REPORT 2011 23

Feedstock Production Increases

through supply significantly. We enhanced the system this year to extend it to

24 PetroSA ANNUAL REPORT 2011

The F-O field development will sustain