Zimbabwe saved from another fuel crisis

An eleventh hour intervention by banks has saved Zimbabwe from a severe fuel crisis, the Zimbabwe Independent has established. Comoil of Libya, which supplies much of Zimbabwe's fuel needs, in the past two weeks declined to pump more fuel to Zimbabwe unless they were paid US$60 million in arrears. The Libyans meet 70% of Zimbabwe's fuel needs, with the remaining 30% coming from Sasol in South Africa. In a deal negotiated by former Mines and Energy minister Edward Chindori-Chininga, Royal Bank and NMB Bank came to the rescue with two tranches of US$30 million and US$150 million respectively, enabling the National Oil Company of Zimbabwe to access 33 million litres of fuel stored at Noczim's Msasa depot. The fuel is owned by Independent Petroleum Group (IPG) of Kuwait, who are leasing the storage tanks to service their clients in the region.

"The country actually started experiencing fuel shortages on the Heroes and Defence Forces days, but this was more of a deliberate move by some fuel companies who were not taking fuel from Msasa for distribution," said a source close to the developments at Noczim. "The intervention of Chindori-Chiniga, who took the MD of one leading oil firm to Msasa to show him his tankers were conspicuous by their absence, saved the situation." The US$180 million deal is reportedly being transacted at an exchange rate of $150/US$1, and will enable the country to have fuel for five months. IPG undertook to release fuel onto the market on the understading that they would replenish their stocks from Libyan oil supplies. The Libyans are reportedly not keen to have the fuel they deliver stored at either Msasa or any other depot, preferring instead that Zimbabwe immediately distributes all the fuel delivered. This enables the Libyans to maintain a crunching grip on Zimbabwe.

President Robert Mugabe last week split the Mines and Energy ministry, leaving Chindori-Chininga with the Mines and Mining Development portfolio, and creating the new Ministry Energy and Power Development headed by Amos Midzi. (ZWNews / Zimbabwe Independent)