MBABALA UPND Member of Parliament Ephraim Belemu says it is unacceptable that the Ministry of Energy has not included information pertaining to the petroleum products procurement schedule in the annual plans for 2018 and 2019.

Speaking when he debated the Report for the Committee on Energy, Water Development and Tourism,Thursday, Belemu said it was not possible that the Ministry of Energy did not procure petroleum products in 2018 and 2019.

“Madam, the committee notes that the cost of fuel is too high in comparison to other countries in the SADC region due to numerous taxes lamped on the wholesale and pump prices build up. The committee recommends that the government should urgently review the tax regime for all petroleum products in order to ascertain the actual cost of duel. Madam the committee notes with concern that the Ministry of Energy did not include information pertaining to procurement of petroleum products in the annual plans for 2018 and 2019. The committee finds this unacceptable and it’s not possible that there was no procurement of petroleum products in 2018 and 2019. The committee strongly urges the government to ensure that the Ministry of Energy compiles with the guidelines and regulations on the public procurement act number 12 of 2008,” Belemu debated.

He recommended that the petroleum Act be urgently reviewed in order to line it with the key changes and the developments that had taken place in the downstream sub sector.

“In line with its terms of reference as contained in standing orders number 157 (2) the committee focused on topical issues of the petroleum industry in Zambia, challenges and opportunities. Madam, the committee was informed that the petroleum act chapter 435 of the laws of Zambia was enacted in 1930. The act was amended in 1964 and 1994 but still did not take into account new developments in the sub sector such as the integration of bio fuel in the country’s energy mix, regulations of filling stations and the fuel marking program. Further, the Act continues to refer to local councils as the institutions mandated to regulate and issue licenses in the downstream sub sector when this function has since shifted to the Energy Regulation Board. In this regard, the Committee recommends that the petroleum act chapter 435 of the laws of Zambia be urgently reviewed in order to line it with the key changes and the developments that have taken place in the downstream sub sector,” he said.

Belemu further recommended that the government urgently upgrades and rehabilitates infrastructure in order to increase production and efficiency.

“Madam the committee observes that both Indeni Petroleum Refinery Limited and the Tanzania Zambia Mafuta Tazama in short pipe lines are experiencing operational challenges as a result of age of the equipment which has been in existence for over 40 years. Further, Indeni Petroleum Refinery cannot process Low sulphur diesel due to lack of diesel hydro tetra units. Yet Zambia has committed to the SADC regional framework for harmonisation of low Sulphur diesel and vehicle emissions. Which will enter into force by the year 2022. The committee therefore recommends that the government should as a matter of urgency upgrade and rehabilitate this infrastructure and prioritise the procurement of the diesel hydro tetra unit in order to increase production, efficiency and to meet the international and regional standards specifications,” said Belemu.

And in seconding the motion Lusaka Central PF Member of Parliament Margaret Mwanakatwe said government was losing a lot of revenue because of tax evasion by unscrupulous vendors.

Mwanakatwe urged the government to channel resources to the Ministry of Energy in order to ensure that they constructed bulk storage facilities.

“The downstream sub sector during interactions with the stakeholders, it was clear that illegal fuel vending is the major challenge for the downstream sub sector. In this regard, the government is losing a lot of revenue because of tax evasion by unscrupulous vendors in this vice. The committee is therefore urging the government to intensify its efforts to curb this vice through marking programs. The committee also noted that out of the 344 service stations only 11 were situated in rural areas as such the rural areas are severely under served or poorly served,” Mwanakatwe said.

“And as such we are finding those same illegal fuel vendors supplying perhaps even substandard petroleum products. We are therefore urging the government to bridge this gap by constructing many more service stations in the rural areas. Thirdly the committee is concerned that the country does not have storage infrastructure for strategic petroleum reserves. In this regard, madam speaker we are urging, as a committee, to channel resources to the Ministry of Energy in order to ensure that they construct bulk storage facilities to ensure that the country has got strategic petroleum reserves,”

She said a national petroleum company could serve as an important statutory institution.

“We believe that a national petroleum company could serve as an important statutory institution to support the development of this sub-sector and integrate it into the economy. In light of this, the committee urges the government to abide by the provisions of the law and ensure that the national petroleum company is created.” said Mwanakatwe.