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OIL Middlemen Face AXE
GOVERNMENT has started an evaluation of the oil procurement process that could see some of the “irrelevant middlemen” eliminated to reduce the cost of fuel.
Energy Minister Christopher Yaluma said in an interview in Lusaka yesterday that Government is reviewing the procurement chain that involves about 13 middlemen with the aim of eliminating all those that will be found to be irrelevant and those charging exorbitant fees.
Mr Yaluma said the long procurement chain and high fees being levied by some of the middlemen has contributed to high fuel pump prices, thereby making it expensive to do business in Zambia.
He said poor management of the country’s affairs, such as oil procurement, by the previous administration has caused a lot of suffering for many Zambians as they have been made to bear unnecessary costs which are a result of carelessness or mere insincerity.
The minister said it was clear, from his preliminary inquiries, that some of the middlemen were being maintained because some individuals benefitted from them through corruption.
Government will only maintain those players it can strictly not do without.
“Some of the agents are necessary but there are some that can be removed.
Government is currently studying the available sources of crude oil after realising that procuring the product from a cheaper
source can bring down the cost and get rid of middlemen,” Mr Yaluma said.
Mr Yaluma, who will soon travel to Tanzania to study the role of some of the middlemen in the oil procurement chain, named the 13 as Glencore, which supplies crude oil and PTA Bank who are the financiers of crude oil feedstock cargo.
Another agent was appointed as collateral manager.
Others are Tanzanian Harbour Authority (THA); Tiper Refinery, who charge US$0.20 per tonne for every consignment that arrives in Tanzania.
He said Tiper Refinery fees are paid to the Tanzanian and Italian-owned petroleum refinery for use of the seven-km under-sea pipeline to transport crude oil from where the ship arrives, to the Tanzania-Zambia Mafuta(TAZAMA) pipeline.
Mr Yaluma said Government was convinced that a cheaper source of crude oil would be found to ensure that the middlemen were cut off and Zambians relieved of the high cost of fuel.
He said since the previous government was unable to monitor the daily operations of the sale of crude oil, they appointed TAZAMA as the seventh agent to oversea the sale of the product. TAZAMA charges another fee of US$5 dollars a tonne for this service.
Apart from that, TAZAMA was appointed again as the eighth agent to manage the farm tank in Dar-es-Salaam where the crude oil is stored before it is pumped into the pipeline.
Mr Yaluma said Zambians pay 0.23 per cent of cost, insurance and freight (CIF) while a total of US$48.52 per tonne is also paid as pumping fees at Indeni Oil Refinery in Ndola which is managed by TAZAMA.
He said Indeni Oil Refinery, which is the eighth agent, separately charges US$56.10 per tonne for refining the crude oil.
The Ndola Fuel Terminal (NFT) which stores the refined stocks and charges K25, 000 a tonne is the other agent, while oil marketing companies charge a fee of K397 per litre for distributing finished products across the country.
Mr Yaluma said the 13th agent, are the fuel dealers operating service stations throughout the country, who receive K263 per litre.
He said all these costs push up the cost of fuel and that this was passed on to the consumer.
“This is what Government wants to address so that we can bring the cost of fuel in Zambia to the reigning levels in the southern African region,” Mr Yaluma said.
“This is what Government wants to address so that we can bring the cost of fuel in Zambia to the reigning levels in the southern African region,” Mr Yaluma said.
Posted by Editor
on November 7, 2011. Filed under LATEST NEWS.
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Mafutamafuta
November 7, 2011 at 8:41 am
Pliz spare us frm such selfish suckers.vijubeni vapakisa nganko shaa!
meswin
November 7, 2011 at 8:43 am
Way 2 go Mr Yaluma!!!! Check them,how can malawi have cheaper fuel than us? They take advantage of us.
C-Jay
November 7, 2011 at 8:46 am
We are waiting, get rid of them!
Bwelele
November 7, 2011 at 8:59 am
That is what we want.Check the Somalians also who are in this business!
kuklaxklan Racist
November 7, 2011 at 9:11 am
way to go boss!
Rod
November 7, 2011 at 9:22 am
Just dont take long…
kays bombs
November 7, 2011 at 9:29 am
Checks and balances should be made soon to axe some fake middlemen becuse fuel is main engine of zambian enconomy
CorrectedZ
November 7, 2011 at 9:31 am
very long overdue! way to go indeed batata ba yaluma
messenger
November 7, 2011 at 9:38 am
Good observation. Good move.
Anani Koffi
November 7, 2011 at 9:41 am
I dont trust your decisions because u are u-turning too much.
swt k
November 7, 2011 at 9:43 am
Just fire them Mr.Yaluma, bengi ba shetani!!!!!!!!!
jhalala2007
November 7, 2011 at 10:41 am
The commission of enquiry to investigate the energy sector should also be probed…How can the composition be like that??? Do you know that winter has invited his brothers in marriage to feast with him on the commission? To hell with promises am not interested.
Chikayeba
November 7, 2011 at 11:05 am
Those are the hiden costs that have pushed fuel prices to such high levels. the sooner they are reduced the better. The MMD did not care for the people.
Tomba ndeya
November 7, 2011 at 11:07 am
Good show boss, This man is the former executive at ESCO here in SA and only resigned two weeks ago and much more experienced that HH the dog who brags about being intelligent with is chikwakwa degree tomba nyina.
Kachepa360+
November 7, 2011 at 11:12 am
Dont make empty promises Mr Yaluma,K360+ is watching your every move..Good play.peace!
MM
November 7, 2011 at 11:23 am
And mmd could not see anthing wrong with such a chain?? shame, please if you can move fast to optimize that process!!
Nakabemba
November 7, 2011 at 11:37 am
What a hell. The Devil is on rampage in Zambia. God help us
ang c
November 7, 2011 at 12:04 pm
gopod move ba minister
shimu kontololwa
November 7, 2011 at 1:28 pm
that’s a gud move ba minister.
Framuka
November 7, 2011 at 1:52 pm
Be reasonable as you sweep out the chaff because you can end removing a linking pin. Otherwise, thats the way forward
shimukuka
November 7, 2011 at 2:01 pm
Does anyone know Glencore the infamous commodity trader owns Mopani Mine,Africa and its greedy leaders have made its people destitutes see these people have seen how gullible our leaders are,they eat every where some one has to do something,Can the PF do something please!
Zedian
November 7, 2011 at 2:56 pm
Mr. Yaluna should also mention how much tax is levied on the fuel pump price.
benco
November 7, 2011 at 3:19 pm
we hope to see results
benco
November 7, 2011 at 3:20 pm
we hope to see the results
Micky Mwaba
November 7, 2011 at 9:19 pm
nakuba bufi do it fast boss