Namcor to present revised fuel import business case
A revised strategy will in the opinion of the Namibia Petroleum Corporation prevent huge losses incurred when fuel was previously imported by this government entity.
The Namibia Petroleum Corporation has reworked elements of its business case to have 50% of its fuel import mandate reinstated.
Speaking to Market Watch this week, Namcor spokesperson Utaara Hoveka said consultation with the ministry of mines and energy was continuing. He said Namcor had prepared a revised document which it felt would address concerns the ministry had raised about its grandiose plan to move away from generating revenue solely on the levies paid by the oil and gas industry.
“Consultations with the ministry of mines and energy on the 50% import mandate are ongoing. After consultations with the minister, Namcor enlisted the services of a service provider to identify the requirements and risks associated with the project,” said Hoveka.
According to him, a decision from the minister was expected towards the end of November.
“Since the completion of the report, Namcor has been working on closing the gaps to mitigate potential risks associated with the project. I am happy to say that we are ready to present an updated report to the minister for his decision towards the end of November 2017,” Hoveka said.
Previous Namcor board chairman Johannes !Gawaxab initially championed the reintroduction of the fuel import quota in 2015. Current Namcor chairman Patrick Kauta took over in pushing for the reinstatement of the fuel import quota.
Namcor in 2008 signed a 50-50 fuel supply deal with Glencore and its subsidiary Petroneft International. The agreement was cancelled in 2010 after the government said it was not favourable to Namibia at the time.
Within the first nine months of starting to trade with Glencore, Namcor suffered losses of around N$195 million, plunging it into technical bankruptcy, according to a PriceWaterhouseCoopers (PwC) audit completed in October 2009.
Initially Glencore in 2011 succeeded in the Namibian high court with its challenge against the decision to suspend the contract. The court overturned the cabinet decision and argued the parties should have had the right to be heard by cabinet before a decision was taken. The court ruled the decision was in conflict with the constitutional right to fair procedure.
Government eventually paid N$538 million to Glencore when it terminated the supply contract. Private fuel companies thereafter were tasked to import fuel.
The new fuel storage facility at Walvis Bay – controvercial because of huge overexpenditure – will increase Namibia's current storage capacity significantly.
OGONE TLHAGE
Speaking to Market Watch this week, Namcor spokesperson Utaara Hoveka said consultation with the ministry of mines and energy was continuing. He said Namcor had prepared a revised document which it felt would address concerns the ministry had raised about its grandiose plan to move away from generating revenue solely on the levies paid by the oil and gas industry.
“Consultations with the ministry of mines and energy on the 50% import mandate are ongoing. After consultations with the minister, Namcor enlisted the services of a service provider to identify the requirements and risks associated with the project,” said Hoveka.
According to him, a decision from the minister was expected towards the end of November.
“Since the completion of the report, Namcor has been working on closing the gaps to mitigate potential risks associated with the project. I am happy to say that we are ready to present an updated report to the minister for his decision towards the end of November 2017,” Hoveka said.
Previous Namcor board chairman Johannes !Gawaxab initially championed the reintroduction of the fuel import quota in 2015. Current Namcor chairman Patrick Kauta took over in pushing for the reinstatement of the fuel import quota.
Namcor in 2008 signed a 50-50 fuel supply deal with Glencore and its subsidiary Petroneft International. The agreement was cancelled in 2010 after the government said it was not favourable to Namibia at the time.
Within the first nine months of starting to trade with Glencore, Namcor suffered losses of around N$195 million, plunging it into technical bankruptcy, according to a PriceWaterhouseCoopers (PwC) audit completed in October 2009.
Initially Glencore in 2011 succeeded in the Namibian high court with its challenge against the decision to suspend the contract. The court overturned the cabinet decision and argued the parties should have had the right to be heard by cabinet before a decision was taken. The court ruled the decision was in conflict with the constitutional right to fair procedure.
Government eventually paid N$538 million to Glencore when it terminated the supply contract. Private fuel companies thereafter were tasked to import fuel.
The new fuel storage facility at Walvis Bay – controvercial because of huge overexpenditure – will increase Namibia's current storage capacity significantly.
OGONE TLHAGE
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