Vitol’s refineries, terminals and the power to choose suppliers

Banking on Oil : episode 5

On 25 April 2024, South Africa’s Competition Tribunal announced its conditional approval of Engen’s acquisition by a Vitol group vehicle. Some conditions concerned an ordinary business decision: where Engen would buy its fuel. Supply commitments to Sasol and Astron Energy were part of the remedy. The new owner would not have complete freedom to redirect those purchases. ^[1]

The transaction closed on 21 May. Malaysia’s PETRONAS sold its 74% stake in Engen Limited to Vivo Energy, a Vitol subsidiary. The seller’s own announcement confirms the transfer. Behind the service-station branding, an importer and trader was acquiring an outlet for the products it sold. That relationship matters at least as much as the sign above the forecourt. ^[2]

Part 1 followed the financing of a cargo, Part 2 mapped the banks behind Trafigura, Part 3 reconstructed Chad’s oil-backed debt to Glencore and Part 4 entered the making of a Platts benchmark. This fifth part turns to the physical network: refineries, storage terminals and distribution businesses. Vitol’s investments show how owning assets can change the routes available to a trader and the suppliers chosen along the way. They also reveal why a map of company logos is an unreliable guide to market power.

A tank can make a cargo commercially useful

A competitive cargo price is only the beginning of an offer. The product still needs somewhere to discharge, suitable storage and a route to the customer. Some supplies also require blending. VTTI describes these as core terminal services, connecting products with ships, trains, trucks and pipelines, depending on the location. ^[4]

Consider a distributor choosing between two fuel offers. One looks cheaper at the loading port but requires storage that is unavailable on arrival. The other can move through infrastructure the buyer already has access to. The meaningful comparison is between delivered products, including the costs and practical constraints of getting them there. Terminal access changes that calculation.

Ownership can make access more predictable and allow closer coordination with other operations. It does not erase existing customer contracts or physical limitations. A tank that is occupied, unsuitable for the product or poorly connected to the intended market cannot simply be called into service because a shareholder needs it. Ownership of the site and availability of usable capacity are separate facts.

A refinery provides a different kind of flexibility: the ability to turn feedstocks into saleable products. Saras, for example, describes a business producing and distributing diesel, gasoline, heating oil and aviation fuel, particularly in Italy and Spain. The plant expands the available supply and processing choices. It must also earn enough to cover the costs of operating those choices. ^[7]

Vitol explicitly presents long-term assets as complementary to trading. Its review of 2025, published in March 2026, lists 1.2 million barrels a day of refining capacity and more than 10,000 service stations in its portfolio. These are company-reported measures of industrial and commercial reach. The review does not provide the asset-by-asset ownership reconciliation needed to turn them into equity-weighted capacity. They should not be read as actual refinery output or as a statement that every site is wholly owned. ^[3]

Saras, VTTI and VARO involve different rights

The Saras acquisition in Sardinia ended in full ownership, but not on the date of the first share purchase. On 18 June 2024, Varas, the acquisition vehicle indirectly controlled by Vitol, bought the Moratti family’s 35.019% holding. Vitol’s direct and indirect stake then stood at 45.48%. A mandatory tender offer followed. Treating the June transaction as an immediate acquisition of the whole company would skip a material part of the process. ^[5]

The remaining shares were transferred on 11 September 2024, when Saras was also delisted. The company’s current profile confirms that the Vitol group acquired full ownership. Saras puts the capacity of its Sarroch refinery at approximately 300,000 barrels a day. That is a description of the facility’s capacity, not a daily production figure. ^{[6] [7]}

VTTI has a shared ownership structure. Its published breakdown is 45% IFM Global Infrastructure Fund, 45% Vitol and 10% ADNOC. Its governance page explains that the Vitol side also includes an investment vehicle sponsored and managed by the trader. IFM separately reports a 45% fund holding as at 30 June 2026. Calling the entire network “Vitol’s terminals” loses both the other shareholders and the company’s own governance arrangements. ^{[8] [9] [10]}

VARO presents another structure. The European merger notification published in July 2025 identifies it as jointly controlled by Carlyle and Vitol Refining Group. VARO was buying sole control of Preem; Vitol was not thereby becoming the sole controller of VARO. The Preem acquisition closed on 16 January 2026. ^{[11] [12]}

Figure 01Documented ownership relationships

The combined company, VAROPreem, says it has access to more than 120 terminals. It does not say that it owns 120 terminals. Its six manufacturing hubs also perform different functions and should not be counted as six interchangeable oil refineries. The network may provide substantial operational reach, but a site count does not disclose the duration, exclusivity or cost of the access agreements. ^[12]

A full owner, a co-investor and a contracted customer have different rights. None of those labels, by itself, establishes that a single trading desk can direct all capacity or inspect every customer’s commercial information. The agreements and governance arrangements still matter.

An outside customer uses the Rotterdam network

There is a concrete example of infrastructure serving a business beyond the shareholder group. On 27 May 2024, Neste announced that it had commissioned capacity at VTTI’s ETT terminal in Rotterdam to store and blend its sustainable aviation fuel. The producer highlighted the site’s connections to the wider European distribution network. This is documented use of the terminal by another industrial group. ^[14]

It does not establish that every applicant can obtain space, or that all customers receive identical terms. Individual tariffs and contracts were not disclosed. It does, however, rule out the simple assumption that Vitol’s investment automatically reserves all VTTI capacity for its own trading operations.

Turning a customer away also has an economic cost: the infrastructure business loses that customer’s payments. For an integrated group, gains elsewhere in the supply chain would have to make up for the loss. Co-investors introduce a further consideration, since a decision has to be assessed from the infrastructure company’s perspective as well. This is an explanation of the incentives, not an allegation about VTTI’s conduct. ^{[9] [16]}

Engen was also somebody else’s customer

The South African case highlights a less intuitive concern. A merger can weaken a rival by taking away its customer, rather than by denying it a necessary input. Engen was a significant buyer of locally refined products. A shift in its procurement could deprive existing suppliers of an important outlet. The Commission identified this as a customer-foreclosure risk, as the Tribunal’s summary explains. ^[1]

There need be no misconduct for purchasing incentives to change. Before integration, a distributor selects among suppliers. After it is acquired by one of them, the consequences of those decisions are assessed across the enlarged group. An order that previously generated revenue for an outside supplier may now support an affiliated business. The displaced supplier then needs another viable route to market.

Customers may benefit if the replacement supply is cheaper. Competition concerns arise when the change weakens other suppliers’ ability to keep the market competitive. Assessing that possibility requires evidence about alternative outlets, costs and customer outcomes. A lost order does not, on its own, establish abuse. The European Commission’s 2008 non-horizontal merger guidelines distinguish foreclosure of supplies from foreclosure of customers, and explicitly separate harm to a competitor from harm to competition. ^[16]

The Tribunal’s account of Engen identifies the relevant infrastructure. Vitol jointly controlled Burgan Cape Terminal in Cape Town, while Engen owned or leased storage in Cape Town and Durban. Combined with Vitol’s import capabilities, these assets raised concerns about the outlets available to local refineries. This was a forward-looking merger assessment, not a finding that Engen had already carried out an exclusionary scheme against Sasol or Astron. ^[1]

Figure 02Supply channels in the Engen merger case

Domestic refining and consumer interests are not automatically identical. A local plant can lose orders because an imported product offers better value. Equally, a temporary gain may need to be considered alongside the longer-term availability of competing suppliers. South Africa’s decision addressed competition and public-interest concerns together; it does not establish that importing fuel is inherently harmful.

Procurement obligations and capital still to be spent

The Tribunal’s public summary describes supply agreements with Sasol and Astron covering minimum purchases, pricing principles and dispute resolution. Those commitments constrain the redirection of some orders. The release does not disclose the actual thresholds or commercial formulas, so it cannot establish how much of Engen’s demand remains open to unrestricted procurement decisions. ^[1]

A separate government announcement on 22 May 2024 sets out capital commitments: R9.85 billion over five years, with a further R4 billion dependent on feasibility studies. That brings the potential amount to R13.85 billion. These are commitments announced when the agreement was signed, not verified expenditure already incurred. ^[15]

Figure 03South African capital-investment commitments

The same statement refers to approximately R100 billion of purchases of locally refined products. That estimate should not be added to capital investment as though the two described the same economic activity. Buying fuel supplies the trading business; capital expenditure maintains or expands the facilities used by that business. Neither amount can simply be described as an equivalent payment to the government. ^[15]

Geographical scope needs similar care. At completion, Vivo described a combined network of more than 3,900 service stations in 28 African markets. This was the enlarged group’s footprint in May 2024, not its South African station count or a statement of its present network. Its accompanying media notes described storage in terms of capacity the business could access. The commercial network was broader than a list of wholly owned property. ^[17]

We did not obtain a complete public reconciliation of the commitments against expenditure delivered by 7 September 2026. The announcements cannot therefore serve as an implementation scorecard. That documentary gap is not evidence of a breach: a multiyear commitment cannot be assessed solely from the release that first announced it.

The supply chain behind Namibia’s divested stations

Recent developments in Namibia bring the distinction between ownership and commercial independence into focus. Vivo publishes a list of divested service stations and states that, from 27 May 2026, they are owned and supplied by Nasan Energies. A familiar forecourt brand can therefore remain while the owner and immediate supplier change. ^[18]

The next question is where the new supplier gets its own fuel. Reuters reported on 6 July that the competition authority had imposed a five-year prohibition on Nasan sourcing from Vitol as a condition of the transaction. A review notice published on 8 May records Nasan’s request to buy from Vitol, Vivo or their affiliates, or alternatively to receive a 60-month transition. ^{[19] [21]}

A ministerial determination published on 3 July 2026 suspended specified conditions until a further decision. Its reasons cite storage and logistical constraints as well as security of supply. Those are the minister’s stated justifications, without an independent assessment of every possible alternative. Reuters confirms the change. The Government Gazette’s four-page facsimile provides the decision and its reasons. ^{[20] [21]}

The minister also points to a policy adopted by his own government: the interim appointment of a single bulk supplier. Reuters reports that Vitol had been awarded a three-month exclusive supply agreement. The difficulty of securing independent supplies therefore also reflects an intervening policy choice, rather than physical infrastructure constraints alone. ^{[20] [21]}

Transferring forecourts does not automatically give the buyer an autonomous supply chain. Requiring independence can support competition, but a requirement with no workable supply route could also undermine a new entrant. The material reviewed does not establish the comparative cost of the alternatives. We found no public confirmation of a subsequent decision reinstating the restrictions before 7 September 2026.

The economics of owning the assets

Not every refinery purchase is evidence of a captured market. On 14 July 2025, the European Commission decided not to oppose the VARO–Preem transaction and declared it compatible with the internal market. The notice appeared on 22 July. That approval cannot certify every Vitol investment as harmless, but it equally prevents this particular acquisition from being presented as one condemned by the European regulator. ^[13]

Integration can improve coordination and reduce repeated negotiations between interdependent businesses. It can make an offer feasible where buying each stage separately would not. Such gains have to be weighed against costs and alternatives. We have no defensible estimate of the benefit or detriment, in cents per litre, attributable to the acquisitions examined here. ^[16]

Owning physical facilities also commits resources for longer than an individual cargo transaction. Buying a refinery, maintaining it and funding the products used in its operations are different financing needs. VAROPreem says the Preem acquisition was fully financed through a debt package. Infrastructure ownership does not remove the banks from this series; it adds assets and financing requirements to the trade those facilities support. ^[12]

To assess customer outcomes, the acquisition announcements would need to be supplemented with access tariffs, genuinely available capacity, supply-contract terms and switching options. A price increase after a merger would not, in isolation, establish that the deal had increased margins. Changes in input costs and market conditions would have to be separated from the effect of the ownership change.

The documented development is that Vitol is connecting its trading business to manufacturing capacity and customer outlets, through arrangements that confer markedly different rights. Engen shows that integration can change procurement choices enough to prompt obligations governing purchases. Neste’s use of a VTTI terminal shows how infrastructure in that investment portfolio can also expand an outside customer’s options.

The decisive question is whether customers and suppliers can switch on commercially viable terms. Refineries, tanks and forecourts make some transactions possible; the contracts around them can make alternatives difficult. That is where the trader’s influence can be examined without treating industrial scale as sufficient evidence of dominance.

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Public-source investigation completed as at 7 September 2026. Portfolio figures are company-reported, not an audited or equity-weighted asset inventory. South African conditions are described from the Tribunal’s official summary; the Namibian Government Gazette facsimiles are cross-checked against Reuters. The investigation uses public documents; no interviews were conducted or requests for comment sent.

Sources and documents

1. Competition Tribunal, South Africa : Tribunal approves Vitol and Engen merger which sees billions invested in SA

   25 April 2024. Official summary of conditional approval, case LM196Mar23. Covers the concerns and procurement agreements, but not their thresholds or formulas. The release expressly states that it is a non-binding explanatory note, not the full conditions.

2. PETRONAS : PETRONAS Completes Transaction on Engen

   21 May 2024. Seller confirmation of the transfer of a 74% stake in Engen Limited to Vivo Energy. Cross-checked against the buyer’s completion release and regulatory approval. This percentage does not describe every subsidiary’s ownership.

3. Vitol : Vitol 2025 volumes and review

   24 March 2026; review of 2025 activities. Company-reported portfolio figures for refining capacity and service stations. No complete asset-by-asset equity reconciliation is supplied. Capacity, output and traded volumes are different measures.

4. VTTI : About VTTI

   Undated page, accessed 7 September 2026. Describes terminal services and transport connections. It establishes the functions offered, not the availability of individual tanks on a given date.

5. Vitol : Completion of the acquisition of the 35.019% shareholding held by the Moratti family in Saras S.p.A.

   18 June 2024. Records the Moratti block purchase and Vitol’s aggregate holding at that date. This step preceded the tender offer and September’s final procedure.

6. Saras, on behalf of Varas : Settlement of the joint procedure and delisting

   Saras’s financial-release register dates this notice to 11 September 2024 and titles it “Settlement Joint Procedure and delisting”. The company’s current profile subsequently confirms full Vitol group ownership and the delisting.

7. Saras : Company profile

   Undated page, accessed 7 September 2026. Confirms full Vitol group ownership and gives Sarroch’s refining capacity. It does not report actual daily throughput.

8. VTTI : Our shareholders

   Undated page, accessed 7 September 2026. VTTI’s published ownership breakdown. The simplified Vitol label is qualified using the governance page and checked against IFM’s reported fund holding.

9. VTTI : Governance

   Undated page, accessed 7 September 2026. Names Vitol Holding B.V. and Vitol Investment Partnership II Ltd, a vehicle sponsored and managed by Vitol. It does not quantify the split between those entities.

10. IFM Investors : VTTI : portfolio

    Position stated as at 30 June 2026; page accessed 7 September. IFM confirms a 45% fund holding. This is a co-investor cross-check, not an independent audit of VTTI.

11. European Commission : Prior notification of a concentration : M.11976, VARO ENERGY / PREEM

    Official Journal, 1 July 2025, C/2025/3600; notification received 20 June. Identifies joint control of VARO by Carlyle and Vitol Refining Group and the proposed sole control of Preem. It does not state VARO equity percentages.

12. VAROPreem : VARO completes acquisition of Preem and creates VAROPreem

    16 January 2026. Buyer’s completion statement, industrial footprint and debt financing. It describes access to more than 120 terminals, not ownership of all those sites. The six manufacturing hubs perform different activities.

13. European Commission : Non-opposition to a notified concentration : M.11976, VARO ENERGY / PREEM

    Decision dated 14 July 2025; notice published 22 July. Non-opposition under Article 6(1)(b). The article relies on the official notice, not a detailed market assessment extracted from the full decision.

14. Neste : Neste expands its sustainable aviation fuel supply capabilities in Europe in partnership with VTTI

    27 May 2024. Terminal use reported by the customer, Neste. Establishes a third-party service arrangement, not a general access obligation or an individual tariff. No quantified environmental claims are used.

15. Department of Trade, Industry and Competition, South Africa : Government and Engen’s new owners, Vitol agree on public interest commitments

    22 May 2024. The body specifies R9.85 billion plus a conditional R4 billion; the headline rounds the figures. Estimated fuel purchases of R100 billion are separate. The indexed full text was reviewed; direct access was intermittent.

16. European Commission : Guidelines on the assessment of non-horizontal mergers

    Official Journal C 265, 18 October 2008, pp. 6–25. Dated analytical framework covering integration gains, input and customer foreclosure, ability and incentives. Used to explain the economics, not to make a legal finding about particular conduct in 2026.

17. Vivo Energy : Engen and Vivo Energy combination completed, creating a pan-African energy champion

    21 May 2024. More than 3,900 stations in 28 markets describes the pan-African footprint at completion. Do not substitute current website counters or equate accessible storage capacity with ownership.

18. Vivo Energy Namibia : Nasan Energies sites

    Page accessed 7 September 2026. Vivo states that the listed sites are owned and supplied by Nasan from 27 May 2026. No national station total is inferred from this list.

19. Namibia Government Gazette, facsimile archived by Gazettes.Africa : Gazette 8914, Government Notice 158

    Notice signed 7 May and published 8 May 2026; application received 8 April. The two-page PDF facsimile sets out Nasan’s application and its alternative request for a 60-month transition. The application was not itself an approval.

20. Namibia Government Gazette, facsimile archived by Gazettes.Africa : Gazette 8969, Government Notice 235

    Determination signed 2 July and published 3 July 2026. The four-page PDF facsimile suspends the specified conditions pending a further decision and sets out the minister’s reasons. Those reasons remain attributed and are cross-checked against Reuters.

21. Reuters, republished by MarketScreener : Namibia’s energy minister lifts bar on Nasan Energies securing fuel from Vitol

    6 July 2026. Confirms the original five-year bar, its removal on review and the three-month exclusive supply agreement awarded to Vitol. This is a Reuters dispatch. Unreconciled station counts are not repeated.