By Agness Changala
Stop always wanting to empower Agro-Fuels in order to bring competitiveness in the oil marketing industry, says Oil Marketing Companies Association of Zambia (OMCAZ) president Dr Kafula Mubanga.
Speaking with Daily Revelation, Dr Mubanga said going forward, OMCAZ expected the government to open up to multiple suppliers or users of the pipeline to reduce the cost of fuel.
“So we expect that the government should bring on the table a lasting solution and not wanting to always empower Agro Fuels. We see this as an agenda to [pp-logged-users] make Agro Fuels get more money out of the Zambian people it is unacceptable, open up the pipeline let people begin to supply, let multiple users begin to use or else, somebody must be fired because planning you’re not, four months down the line, you can’t tell me that they could still not resolve the issue of the pipeline, except if they wanted not to,” Dr Mubanga said “Come on if there is some technical failure in managing of national resources, we want to appeal to the government this is not happening. This is not helping, and we expect that the President will give further directives to ensure that the issue of fuel is resolved.”
Dr Mubanga said the association expects the government to manage the manipulations that happen within the sector towards and during the election period.
The Energy Regulation Board (ERB) on Monday announced that eight companies had been fined a total of K408, 000 for their failure to comply with prescribed license conditions as mandated by the provisions outlined in the ERB Act.
The companies fined include WWW Investment Limited, Chingases Company Limited, Total Energies Zambia, Admire Energy Limited and Vivo Energy Zambia.
Others are Mount Meru Petroleum Limited, North-Western Energy Corporation and Minegases Company Limited.
Dr. Mubanga welcomed the move saying ERB was growing its teeth, adding that a long time ago, multinational companies were sacred cows and only local companies were penalised, given charges and had their licenses suspended.
“It is a welcome move, and it indicates that ERB is growing … and we appreciate that because in the past, we had issues where only small OMCs especially Zambians were penalised, given charges, suspension of licenses and so on and so forth without necessarily targeting the multinationals,” Dr. Mubanga said. “But it’s clear that under this mandate, there are no sacred cows so we hope that there shall be no sacred cows going forward.”
He said the penalisation also sets a clear tone for 2026 because it was expected that a lot of this would happen where multinationals deplete stock levels against what they have to supply.
Dr. Mubanga said this created a technical crisis that would lead to panic mode and panic purchase.
“We hope that in the next two years, the government will manage the multinationals and ensure that they have strong and regulatory frameworks that will regulate those that abrogate the processes or the license vis-a-vis Tanzanian authorities,” he said. “When you are given a contract or declare to supply the nation with a particular volume and then you default, what happens is that the entire year, you don’t supply. You don’t participate in any supplies, so we hope that the government will go to that level to manage the expected manipulations that happen within the sector during … towards election period, we believe that this is a step in the right direction.”
And Dr. Mubanga said the government decided to single source or at least give one user the pipeline and this in itself meant that the prices of fuel were going to be tagged to one supplier’s price.
He said the government had not adequately addressed the issue of competitiveness and this had triggered the price of the pump prices.
“So the government has not adequately addressed the issue of competitiveness and because of that, it has actually triggered the price of the pump prices. From the case in point of Agro Fuel versus Devon Oil, you see that there was a discrepancy in terms of pricing. We still had K10 in between from the prices that Devon Oil offered and what Agro Fuels has actually been supplying, so there is this gap,” Dr. Mubanga said.
He said once the government opened up the tender supply or usage of the pipeline, the country would see the prices coming down.
Dr. Mubanga also said the government was not willing to remove Agro Fuels from the picture to create a competitive environment.
“The excuses that are being offered by various stakeholders that the minister yes has the power to single source via the SI really is this going to advantage, is there an emergence? There was no emergence for us to go and single source,” Dr Mubanga said. “We had enough time. We either didn’t plan properly, we didn’t manage properly for us to get to a point where we are propelled by an SI to single source alright or to give one supplier to use the pipeline. We had all the time. It means that there was no planning that was involved.”
He said the defence mechanism of getting to a single source via an SI is not adequate.
“It must come when it’s extreme, when there is a shortfall of supply is justification for that. Then Cabinet can approve such an emergency action but that was not an emergency when we actually single sourced for this Agro Fuels,” he said.
Dr. Mubanga said there was little political will to address this issue and appealed to the government to open up.
Dr. Mubanga said those in power, in case they failed to address these issues, they should step down and give chances to others to manage these resources.”
