Agness Changala
PF president aspirant Emmanuel Mwamba has asked the Anti-Corruption Commission (ACC) to investigate corruption allegations against Energy Minister Peter Kapala that he awarded an oil tender to Transworld without following tender procedures.
And Mwamba has stated that the controversy surrounding this scandal, highlights the need for thorough investigations into the matter to ensure transparency and accountability in the government procurement processes and the current crisis at the Ministry of Energy.
Meanwhile, Mwamba has told the ACC that the scandal has cast a shadow over the government’s credibility and that stakeholders are eagerly awaiting a response from Kapala and other relevant authorities.
In a letter dated November 10, 2012, with a subject, “Corruption at Ministry of Energy,” Mwamba has stated that on Monday, November 06, 2023, the News Diggers in its edition No 1597 reported that, “KAPALA IN NEW OIL SCANDAL.” Where Kapala has allegedly awarded an oil tender without following tender and laid down procedures.
According to Mwamba, in a letter of November 2, 2023, addressed to the managing director of Transworld, Kapala awarded a contract to the company for the importation of Low Sulphur Gas (LSG) through the TAZAMA pipeline.
Mwamba stated that this is against the spirit of a recent public tender process where 19 companies expressed their interest to supply through a tender process which closed on November 02, 2023, the day Transworld were unilaterally awarded the contract by the minister.
He stated that Transworld was not part of the public tender.
“Please note that Transworld were not part of the public tender. This action violates the Public Procurement Act, 2020 and the Public Finance Management Act, 2018,” Mwamba stated.
He stated that by these laws, Kapala is excluded from granting or cancelling public contracts and that these powers and authority lie with the controlling officer or procurement committee.
Mwamba stated that laws under the Public Procurement Act No 8 of 2020 under section 70, do not grant the minister any power to award or withdraw contracts.
Mwamba added that according to Procurement Acts, there is no provision for the Kapala to award or cancel a government contract.
“Furthermore, the Public Finance Management Act does not grant the Minister any role in financial management or commitment of the Republic through the procurement process. It only provides for the controlling officers’ role,” he stated.
Mwamba stated that while the Petroleum Act allows the Minister to make regulations for the better execution of the Act based recommendations from the Energy Regulation Board (ERB), these regulations are administered by the Board.
He stated that the stated regulations are limited to areas such as importation and exportation of Petroleum and do not grant the minister authority over contracts awards.
“Even though the Act provides for a degree of authority to the Minister to make regulation, it does not grant unilateral powers to award contracts or make decisions that contradict the procurement and financial management laws,” Mwamba stated.
He stated that even SI 41 of 2023 which he had studied carefully, does not cause the Ministry to be precluded from following procurement procedures as provided by the Public Procurement Act of 2020.
Mwamba added that even though the guidelines contain a section on “Special Circumstances and Deviations,” which states that in emergency situations or unforeseen circumstances, the Minister of Energy may guide TAZAMA in writing on suitable actions to remedy such situations, this section also does not create legal room for Kapala to justify his actions in awarding the contract to Transworld without causing the relevant offices to procure, even to single source in accordance with the procurement Act.
“The Act does provide for instances of emergencies which should have been followed. Again, guidelines cannot supersede an Act or regulations made under the Act. The award of the contract by the Minister is illegal,” he stated.
Mwamba wondered why the Zambia Public Procurement Authority (ZPPA) is not initiating any action on this matter.
Meanwhile, Mwamba has revealed that the company Transworld, which is at the center of this procurement scandal is a new company which was registered in August, 2022.
He stated that the company as per ERB record was registered a few months ago, before being considered for substantial diesel supply contract.
“What makes this situation even more controversial is that Transworld only obtained its license recently, making it a newcomer to the petroleum supply industry,” He stated.
Mwamba further stated that Transworld lacks experience as ERB statistics indicate that the company has not sold a single liter of petroleum product to date, further raising doubts about its competence to meet the demands of a huge countrywide diesel supply contract.
According to Mwamba, industry insiders have expressed concern that Transworld may not have the necessary infrastructure, resources and experience to ensure a consistent and reliable supply of diesel, making it a potential failure leading to severe fuel shortages in the country.
He stated that the criminal intention deepens as it becomes clear that the letter from Kapala did not account for the critical pre-qualification criteria published by TAZAMA during their Expression of Interest (EOI) process.
Mwamba stated that the criteria are intended to ensure that suppliers have the required experience and capabilities to meet the demands of such contracts, adding that Transworld, surprisingly is not amongst them.
“One of the key areas where Transworld appears to fall short is its lack of experience in the petroleum sector, a fundamental requirement for diesel supply contracts. Awarding such a critical contract to a company with no track record in the industry is seen as a departure from established procurement procedures, putting the country’s energy security at risk,” He stated.
Mwamba further stated that with Transworld’s experience and questionable circumstances surrounding the contract award, the country faces the looming threat of fuel shortages.
He stated that the decision to grant a contract to a new company with no proven ability to meet the demand, has raised concerns among citizens, businesses and industry experts alike.
Mwamba stated that as public outcry intensifies, demands for a thorough investigation into the matter are growing louder.
He stated that citizens, industry experts, and opposition leaders are calling for transparency, accountability and reasonable governance.
He observed that the ongoing scandal surrounding Kapala’s involvement has been extensively covered by various media.
Mwamba stated that this is not the first time Kapala has done this, as per previous reports ZPPA has expressed its intention to investigate reports that he awarded and cancelled a contract for cheaper fuel imports by Devon Oil Zambia.
He also stated that Transparency International Zambia (TIZ) and the Oil Marketing Companies Association of Zambia called on President Hakainde Hichilema to suspend Kapala, raising questions about his abuse of power.
Mwamba stated that it is important to see a pattern of concern and controversy surrounding the actions of Kapala in relation to fuel supply contracts and tender procedures.
He stated that the allegations raise questions about the transparency, legality and potential corruption in these dealings.
Mwamba stated that the allegations of Kapala’s involvement in the award of a fuel contract to Transworld have raised significant concerns about the abuse of power and the deviation from established procurement processes.
He stated that the minister’s actions appear to be inconsistent with the laws governing public procurement and financial management, which grant the authority for contract awards to controlling officers.
“Furthermore, the minister’s reliance on the Open Access Guidelines, “Special Circumstances and Deviation,” section as a justification for his actions is subject to scrutiny, as these guidelines should not supersede the laws and regulations established by the Public Procurement Act and The Public Finance Management Act,” read the letter in part.
