PIL yet to be told on fuel role shift

Post was last updated: December 7, 2015

Malawi’s Petroleum Importers Limited (PIL), a private sector consortium that currently imports fuel into Malawi, says it is yet to be officially informed on the decision by government to shift the responsibility of fuel importation for the country to state-owned National Oil Company of Malawi (Nocma).

Nocma says, however, it will engage PIL in processes to ensure a smooth transition of the role.

PIL General Manager, Enwell Kadango said on Friday that the company is yet to be contacted by government and that they too have just learned about the development from a statement from the Ministry of Natural Resources, Energy and Mining.

“And there is little we can say because the statement does not provide details. There are no implementation dates and the actual plan as to how this change will happen,” said Kadango.

He, however, said PIL’s view remains that the matter should go through industry wide consultation so that all options are laid bare for the best interest of the nation.

“We believe we have done a very good job over the last 15 years. In the years when the country experienced shortage it was because no foreign currency was made available to pay for the volume already used and also the country was not recovering the actual cost of importation,” said Kadango.

He said PIL supports the idea of bulk fuel importation and that this is exactly what the company has been doing since 2000.

“It is not strange to us at all. We have managed to drive fuel importation using the economies of scale and better prices being enjoyed today and before are as he said under the current contract through which fuel is being brought to Malawi, PIL has managed to save Malawi US$ 6 million in premium.

“And our establishment is lean meaning working with the highest efficiency you can talk of in the procurement of fuel for Malawi,” he said.

Asked about the future of PIL in the wake of the policy changes, Kadango said the company will continue to import fuel for its customers and as it has contracts running.

“There should be no panic of any interruptions that I can assure the nation. Changes can come but have to be managed properly to avoid affecting the system that is working effectively,” he said.

He believes that bulk-purchasing system can achieve the same objective even with more than one player as long as the country has pooled tendering process and selected players draw from the same contracted volumes.

“Depending on the model chosen, which we have not seen, you can manage bulk supply with more than one companies importing as long as you lock your volumes from a pooled tender process,” he said.

Nocma spokesperson Telephorus Chigwenembe said following the announcement from the government, the company is targeting June 2016 as the time they could be able to take over the fuel importation role.

“Meanwhile, Nocma and PIL will be engaging each other in processes aimed at ensuring a smooth transition. The transition has to be managed well so that the industry should not suffer in any way,” said Chigwenembe.

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