Tuesday, October 13, 2009

Tazama Pipelines [Zambia] Acts to Avert Fuel Crisis

TAZAMA Pipelines yesterday sent more than half of Zambia's daily consumption of petrol to Lusaka to ease the fuel crisis triggered by a fault at Indeni Oil Refinery, Chief Government Spokesperson Ronnie Shikapwasha said.

Lieutenant-General Shikapwasha said Tazama dispatched 400,000 litres of petrol to Lusaka, slightly below Zambia's daily consumption of 700,000 litres and that was expected to satisfy the capital city's demand for the product.

"About 400,000 litres of petrol were sent to Lusaka and that will continue for the next few days," Lt-Gen Shikapwasha said.

The Government had also engaged Kuwait's Independent Petroleum Group (IPG) to import fuel on behalf of Tazama Pipelines from Mozambique, in addition to what will come from Tanzania to avert a crisis during the two-week shutdown of Indeni refinery.

Industry sources said the government planned additional fuel imports from Mozambique to ensure there was no major crisis when Indeni petroleum refinery, which had developed a fault would be shut down on Thursday for maintenance.

A source said on condition of anonymity the Government had engaged Daibit to import fuel from Dar-es-Salaam, Tanzania and IPG to bring in additional diesel and petrol from the Mozambican port of Beira.

He said the director of energy and officials from the Energy Regulation Board (ERB) yesterday met 24 oil marketing companies (OMCs) in Lusaka and asked them to specify their requirements so that arrangements could quickly be done.

He said the OMCs were today expected to submit their required quantities of diesel and petrol to the Government so that Daibit and IPG could directly deliver the fuel to them instead of taking it to the Tazama terminal in Ndola.

The source said before the shut-down, Tazama would continue delivering its limited stocks to the OMCs to ease pressure on them following the refinery fault which had reduced Indeni's output of petrol.

The Government announced on Saturday that, to have stocks during the shutdown, 15 million litres of petrol and 25 million litres of dieasel would imported from Tanzania.

The refinery was due for routine maintenance shut-down in mid-October but developed a fault, which reduced the output of petrol.

The Zambia Competition Commission (ZCC) said it had received what appeared to be serious allegations that OMCs had conspired to withhold petrol with a view of creating a shortage and eventually triggering a price increase.

ZCC executive director Thura Kaira said in a statement yesterday that hoarding of a product was a serious offence under Section 12 (a) of the Competition and Fair Trading Act, CAP 417 of the Laws of Zambia.

Mr Kaira said the commission had since commenced investigations to determine the extent to which OMCs were engaged in the conduct.