THE Corruption Prevention Bureau in Tanzania is investigating how a ship carrying cheaper fuel for Zambia was blocked from offloading in Dar-es-Salaam, sources in that country have told News Diggers.

Energy Minister Peter Kapala this month cancelled a contract that he had awarded to Devon Oil and Glencore Energy of UK for the supply of fuel that had been offered at a landed wholesale price of K19.50 per litre, representing a K1.90 discount below the ERB regulated price.

The minister cancelled the contract on grounds that Devon Oil did not meet the condition to deliver the fuel before the end of September.

Meanwhile, sources at ERB have told News Diggers that the Energy Regulation Board is faced with a difficult situation on whether to effect a fuel price review tomorrow which may result in an upward adjustment, or to actualize the quarterly review as guided by President Hakainde Hichilema.

“There was a serious concern from the [Tanzanian] government here on this ship that was not allowed to offload. The investigation was carried out to establish if some Tanzanian officials were involved in this matter. As you know the facility (TAZAMA) is co-owned. If you followed the issue, Tanzania has always given berthing priority for Zambian fuel when there is a shortage. So when the officials in Tanzania were asked about this, they referred to a document which was sent from Zambia Energy [Regulation] board which was saying Zambia still has stock for about 17 days. These officers were actually saying the information came from Zambia that there was no hurry [to offload] as there was sufficient stock. So given that information it means on the part of Tanzania, it had less stock compared to Zambia,” the source explained.

“But now after seeing this matter escalate with complaints coming from Zambia again that the ship was blocked by Tanzania, an investigation was launched. As you are aware, President Hassan was scheduled for a State visit to Zambia, so there was concern that there might be a bilateral issue raised by your President on this issue, so it was to get answers. I can tell you that at least two officials from Zambia were summoned for questioning, and one of them is the TAZAMA regional manager”.

TAZAMA regional manager Patrick Musenyesa wrote to the Tanzania Petroleum Bulk Procurement Agency indicating that his office would not accept the diesel consignment imported by Devon Oil to be offloaded and pumped onto the Pipeline.

“Devon Oil Zambia has failed to supply Low Sulphur Gas Oil by month-end of September 2023 as directed and therefore, the Ministry of Energy (Zambia) cancelled the approval granted to them. In view of the cancellation of the approval, TAZAMA is not in a position to receive Low Sulphur Gas Oil (LSG) from the vessel MT HAIMA into our storage tanks,” he wrote.

The Ministry of Energy has insisted against allowing the vessel carrying cheaper fuel from offloading its content, but has granted authority to a rival company Agro-Fuel Investment to import the commodity.

Agro Fuel is the only company that has been using the TAZAMA Pipeline through single-sourcing, a case which the Anti-Corruption Commission says it’s investigating.

And according to ERB sources, petrol is expected to maintain its price while diesel is poised to take a K1 plus hike, should the authority go ahead to conduct the monthly fuel price review.

“The idea was to maintain the current price as we move towards the quarterly reviews. But from the calculations done, it looks like it would be more sustainable if the price is revised for this month, then we now wait for at least three months or so. Leaving it like this may not be sustainable. For petrol, it may be possible to keep the current price, but for diesel, we are looking at around K1 plus,” said the source.