Maravi

Government negotiates with Gunvor, Trafigura

Government negotiates with Gunvor, Trafigura
By Kabanda Chulu
Tue 29 May 2012, 13:28 CAT

ZAMBIAN security wings carried out intensive investigations over concerns about corrupt and unsound environmental practices by preferred bidders engaged in negotiations for the supply of fuel, says energy permanent secretary George Zulu.

And Zulu justified the presence of PF cadres like Willie Nsanda and other stakeholders who sat on the fuel procurement evaluation committee "because they were Zambians with the interest of the country at heart".

Announcing the Zambia Public Procurement Authority (ZPPA)'s recommendation for the government to enter into negotiations with Swiss based Russian oil supplier, Gunvor and Netherlands-based Trafigura for the US$100 million two-year supply and delivery of 1,440,000 metric tonnes of petroleum feedstock and 216,920,000 litres of diesel and 21,230,000 litres of unleaded petrol, respectively, Zulu yesterday said negotiations with the preferred bidders will take 10 days.

On the part of crude oil, Gunvor had the lowest bid, a company trading approximately 1,000,000 barrels per day - more than what Zambia consumes per month.

"It is the intention of government through the Ministry of Energy to ensure that the best supply terms are adopted during the negotiations and it should be noted that invitation for negotiations does not mean award of contract and we shall try to settle for reasonable prices so that the country can have cheaper fuel rates," he said.

"Inquiries were sent out by our security wings to look at concerns like that of corruption and environmental management by the preferred bidders and they have not done anything illegal in Zambia, for instance, Trafigura's subsidiary BP or Puma Energy, we have had no problems with them and they have been cleared because they have done nothing wrong in Zambia."

He said the government will strive to undertake the engagement of oil suppliers in a transparent manner considering that petroleum business is associated with corruption.

"We shall fight corruption in this matter and this is why we included various stakeholders in the evaluation committee and we had people from the security wings, private sector and Mr Willie Nsanda because he is a Zambian and as a transporter he has the interest at heart of the country and we are thankful to the media for keeping us in check but this whole process has undergone an objective, comprehensive and open evaluation process," Zulu said.

He said the forthcoming oil procurement might not be funded by the PTA Bank which has been issuing letters of credit over the last two years since the collapse of the deal with Stanbic Bank that was supposed to finance the purchase.

"Government is looking for other alternatives and these options of financing will be part of the negotiations," said Zulu. "Upon approval of satisfactory negotiations by ZPPA, the ministry may be authorised to award contracts but offers for award of contracts will be first sent to the preferred bidders and thereafter contracts approved by the Attorney General will be signed by government and suppliers."

Labels: ARMED FORCES, OIL, ZPPA

posted by MrK @ 3:11 PM