TOR NO. 2010/

TERMS OF REFERENCE FOR THE APPOINTMENT OF SERVICE PROVIDER FORAUDITING COMPLIANCE TO THE SOUTH AFRICAN PETROLEUM AND LIQUID FUELS BY OIL COMPANIES AND ASSESS ITS IMPACT THEREOF

1.GENERAL/BACKGROUND

The year 2010 marks the 10th anniversary when the South African Petroleum and Liquid Fuels Charter (the Charter) was developed and signed to provide a framework for progressing the empowerment of Historically Disadvantaged South Africans in the liquid fuels industry. Petroleum Products Amendment Act; 2003 (Act58 of 2003)(PPAA), gives effect tothe Charter which embraces Black Economic Empowerment (BEE).Section 12C, of thePPAA authorises the Minister of Department of Energy to make specific regulations and also prescribe a system for allocation of licences as provided for by Section 2E. Hence consistent, continuous monitoring; evaluation and enforcement of compliance is necessary. Compliance with the Charter is key to accelerating economic growth and also deracialising the ownership and control of productive assets and entrepreneurial capabilities in the petroleum and liquid fuels industry.

The Charter signatories acknowledged that achieving set targets is an ongoing process. The Department of Energy as a custodian of energy policies must thereforeconsult, monitor, evaluate and report annually on the progress to achieving objectives of the Charter as espoused in the Energy Policy White Paper,i.e.‘sustainable presence, ownership or control by Historically Disadvantaged South Africans of a quarter of all facets of the liquid fuels industry, or plans to achieve this’.

The Petroleum and Liquid Fuels industry is a strategicallypositioned to accelerate shared economic growth and creation of decent jobs. An effective implementation of the Charter therefore requires a monitoring and evaluation system capable of assessing progress with regards to measuring compliance to the Charter focusingon all elements of the Charter across the value chain.

2.THEOBJECTIVE OF THE PROJECT

  • To have a comprehensive, independent and representative assessment of the state of transformation within the industry against the set Charter targets
  • To determine whether signatories of the Charter are in compliance with the initiatives embarked on according to the 2002 BEE evaluation report (taking into account the findings of the previous audit reports)
  • To identify bottlenecks in the implementation of the Charter and interventions required
  • To develop standardised criteria to asses and monitor transformationand compliance with petroleum and liquid fuels industry charter throughout the value chain
  • To develop and implement skills transfer critical to strengthening of the Department‘s capacity to conduct an annual survey of the industry tomonitor and evaluate progress on achieving the objective of theCharter
  • To develop an implementation strategy that will optimally contribute to achieving transformation in the industry

3.SCOPE OF THE AUDIT

To achieve the above objectives, a competent service provider is required toprovide the following:

  • Undertake a comprehensive Audit on the level of compliance of the Petroleum and Liquid Fuels industry with the Liquid Fuels Charter.

Conduct impact assessment of all interventions byoil companies who are signatories to the South AfricanPetroleum and Liquid Fuels Charter

  • Develop an empowerment measurement framework for the petroleum and Liquid Fuels Sector.
  • Make recommendations to the evaluation committee regarding short, medium and longterm goals for the Petroleum and liquid fuels industry in meeting the objectives, and addressing challenges, of the Charter.
  • Undertake or investigate any matter as may be delegated by the evaluation committee in relation to the government transformation programme relevant for the Charter.
  • Develop and transfer of skills to enhance internal capacity on the implementation of the evaluation and the monitoring systems and external capacity to ensure accurate application of the Charter.

4.OUTCOMES

  • A comprehensive Audit Report on the level of compliance with the Petroleum and Liquid Fuels industry charter
  • An empowerment measurement framework for the petroleum and Liquid Fuels Sector
  • Recommendations to improve future interventions for the Department of Energy to fast track petroleum industry transformation across the value chain
  • Report on training programme for skills transfer

5.REPORTING

  • The nominated company will report progress made or any other matter relating to the project to the Liquid Fuels Charter Compliance Audit team.
  • Meetings and reporting by the service provider to the Liquid Fuels Charter Compliance Audit team will be held bi-monthly from the signing of the contract.
  • The nomination and appointment of the Liquid Fuels Charter Compliance Audit team members shall be ratified by the Head of the Hydrocarbon and Energy Planning Branch.

6.PROJECT DURATION/ COMPLETION DATE

The expected duration of the project is one year after the signing of a contract

7.BRIEFING SESSION

A compulsory information session will be held at the Department of Energy Head Office- 70 Meintjies Street, Travenna Campus, Sunnysideas per SBD 1 form

8EVALUATION METHODOLOGY/CRITERIA

8.1Project Cost

  • The consultant will be requested to give a quote regarding the work to be undertaken for this project. The cost must be VAT inclusive and should be quoted in South African rand.
  • Costing shall be aligned with the project activities/ project phases.
  • Financial proposal shall be separate from the technical proposal

8.2Previously DisadvantagedIndividuals (PDI’s)

  • Provisions of the Preferential Procurement Policy Framework Act (PPPFA) will apply.

8.3Qualifications

  • Project team members’ Qualifications : Chartered Accountant, Post Graduate qualification in Corporate or company Law, Post graduate degree in Business administration, Industry audit related qualification
  • The team should have a combined experience of a minimum of four years in the following areas: auditing, research, compliance, corporate law. Proven track record by the service provider of assessing companies’ compliance with their respective Charter requirements for a minimum of 2 years.

8.4Company Experience

  • Companies are required to provide proof that they have facilitated/ performed similar project, accompanied by correspondence from references proving that such was executed as well as their contactable references
  • Failure to submit the recommended letter for previous similar rendered project(s), will be interpreted as a lack of requisite experience or credentials.

8.5Team Leader and Members Experience

  • Team leader and members should have a minimum of 2 years financial and/or BEE audit and experience and industry related expertise
  • CV’s should be attached on the technical proposal

8.6Project planning/Methodology

The service provider is expected to indicate the

  • methodology to be utilised to execute project intermediate
  • a detailed project plan with final outputs and time frames/ milestones

9.EVALUATION CRITERIA LINKED TO NUMERIC VALUES

  • Table below will be applied in order to evaluate each bid
  • 90/10 principle in terms of the Preferential Procurement Policy Framework Act is applicable

Phase 1: Technical Evaluation

CRITERIA / WEIGHT
Qualifications of team members / 10
Company Experience / 15
Team Leader & Members Experience / 15
Project Plan / Methodology / 20

Phase 2: Price and Specific Goals

CRITERIA / WEIGHT
Project cost / 30
Historically Disadvanged Individual [HDI] / 10
People with no franchise prior to the 1993 constitution / 5
Women equity / 4
Disability / 1

NB:Only bidders who obtain at least 50% under technical evaluation will be considered for further evaluation

10.ENQUIRIES

10.1Ms. Daisy Maraba

Tel: 012 444 4373

E-mail:

10.2Ms. Sibongile Monoto

Tel: 012 444 4371

E-mail:

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