Inept fuel importers lose licences

The government yesterday revoked licences of oil firms which have failed to import the commodity, subjecting the country to unnecessary shortages.

The government also disbanded and formulated afresh Petroleum Importation Coordinator (PIC) board of directors on grounds that it has also failed to discharge its responsibilities diligently.

The minister for Energy and Minerals, Prof Sospeter Muhongo, took the steps yesterday, two weeks after the country started to experience shortages of petroleum products, earlier blamed on faulty discharging facilities at the Kurasini Oil Jet (KOJ).

Prof Muhongo said in Dar es Salaam yesterday that for the past six months, the importers had failed to ensure they had imported enough fuel for the country.

“Ewura (the Energy and Water Regulatory Authority) has been hesitant in taking action against importers, therefore, we have made the task simple for them,” he said. 

He apologised to Tanzanians for enduring the shortage of petroleum products in the country. “We have taken appropriate measures but we can now assure the nation that we have enough fuel for domestic use,” he declared.

The minister said, however, that the licences would be reinstated if the companies manage to prove to the authorities that they were capable of carrying out their mandate.

He said the new PIC board would start operations next Tuesday, explaining that it would be composed of large oil importers, middle class businessmen as well as small retailing companies.  Ewura, Tanzania Revenue Authority (TRA), and Tanzania Ports Authority (TPA) would also be represented in the board to be chaired by a ministry official.

Meanwhile, the Energy and Water Utilities Regulatory Authority (Ewura) has sanctioned the sale of 27.4 million litres of petrol, diesel and kerosene in the local market that was originally meant for transit to neighbouring countries.

Nine oil companies had requested the regulator to allow them to sell 21 million litres of Petrol, 5 million litres of diesel and 1.4 million litres of kerosene in the local market.

Ewura Communications manager Titus Kaguo said the move would boost the current oil stocks in the country.

“We have received and granted the applications. The Tanzania Revenue Authority (TRA) has ordered the companies to fully pay tax for the fuel before it’s diverted into the local market,” said Mr Kaguo.

According to Mr Kaguo, the oil shortage experienced in the country was not man-made but rather caused by inefficiency in the offloading of fuel tankers at the port.

“This problem is exacerbated by a poor infrastructure. We have oil that is not serving us because of inefficiency during offloading,” said Mr Kaguo, adding that the problem is mainly compounded by lack of oil reserves.

He noted that currently the country has (besides the localized stock) a stock of 35.8 million litres of diesel which could serve Tanzania for 10 days, 16.2 million litres of Petrol (9 days), kerosene 0.6 million litres (3 days) and Jet A fuel (25 days).

Currently, oil consumption in Tanzania stands at 1.7 million litres of petrol, 3.54 million of diesel and 200,000 litres of Kerosene.

Meanwhile, the fuel shortage facing various parts of the country has drawn Parliament’s attention, with lawmakers demanding the government’s explanation. Many MPs supported an urgent private motion presented by Mwibara MP Kangi Lugola who asked the House to suspend other businesses to discuss the fuel crisis.

Mr Lugola expressed worry that despite passing the bulk system of procuring fuel as a permanent solution to the problem in the last meeting, the shortage has continued to persist.

“I have suspicions that there is sabotage in the issue of fuel procurement… it can’t always be this way,” he said.

Ubungo MP John Mnyika wanted to know the fate of the Parliament Committee on Energy and Minerals, which was dissolved over corruption allegations. He argued that the absence of the committee had denied the country a chance to address the fuel problem.
Source: The Citizen,http://www.thecitizen.co.tz, reported by Nora Damian in Dar es Salaam, additional reporting by Alex Bitekeye in Dar and Bernard Lugongo in Dodoma
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