The Government through Energy and Water Utilities Regulatory Authority (EWURA) has slapped compliance orders to four major oil companies that have been identified as engineers of the ongoing fuel crisis to resume operations immediately.Delivering the government's statement in the National Assembly on Tuesday, the Minister for Energy and Minerals, Mr William Ngeleja, named the operators as BP Tanzania, Engen Petroleum Tanzania, Oil Com and Camel Oil.
The move follows an emergency motion moved in the House by the Chairperson of the Energy and Minerals Committee, Mr January Makamba (Bumbuli - CCM), regarding fuel crisis which he said was strangling the country's economy.Mr Ngeleja stated that the order requires the companies to provide services at their depots and petrol stations as provided for by the law or face sanctions.
The minister further gave the said companies 24 hours to state why punitive measures should not be taken against them for contravening the country's fuel trading regulations and ordered them to stop creating fuel shortage.The minister said the companies had the opportunity to appeal to the fair competition tribunal if they had any grievances against the fuel price but did not do so. Among sanctions the companies face include revocation of their fuel trading licences.
The government has, effective yesterday, licensed and directed COPEC, a subsidiary company of the Tanzania Petroleum Development Corporation (TPDC) to start importing and distributing fuel with view to curb fuel shortage.The Deputy Speaker, Mr Job Ndungai, had to shelve debate on the estimates of the Ministry of Industries, Trade and Marketing to allow the Parliament Steering Committee to decide on the issue, which it approved. Mr Makamba said over half of the petrol filling stations in the country were not selling fuel, a week after EWURA had dropped prices, blaming the energy utility firm for failing to stand firm to ensure the directive was adhered to and the country's regulation followed. He demanded government's statement by yesterday evening.
"Instead of fuel prices going down, they have escalated and we get phone calls and messages saying in some parts of the country, the petrol or diesel was selling at up to 5,000/- a litre," he said. The MPs called for urgent government's intervention on the fuel crisis demanding oil marketing companies to be ordered to release fuel by yesterday evening or have their licences revoked. The Deputy Head of the Official Opposition in the House, Mr Kabwe Zuberi Zitto (Kigoma North - Chadema), said the decision to reduce fuel prices was aimed at cushioning hardships faced by the common man and a cartel formed by fuel firms that targets holding the government at ransom.
He said such malpractices should not be tolerated."Fuel firms should be given up to 6:00pm on Tuesday to release fuel or else direct the army to dish out fuel and have their licences revoked," said Mr Zitto. He was supported by Anne Kilango Malecela (Same East-CCM), Jenister Mhagama ( Peramiho - CCM) and John Mnyika (Ubungo-Chadema), who said interest of common men should be given priority in all decisions made in the House, therefore calling for support of EWURA in ensuring the new rates were followed.The MPs also proposed government to act on BP in which it has 50 per cent stake and revival of TIPER, saying it was a mistake to liberalise fuel importation and distribution by 100 per cent.
The MPs also said some government officials were trading in fuel hence holding back development in the sector. Addressing a press conference in Dar es Salaam yesterday, the Director General of EWURA, Mr Haruna Masebu, said that the compliance orders, among other things, require the four firms to explain why legal action should not be taken against them for disrupting the supply chain."The order also requires the four operators to stop any action or inaction that will disrupt the supply chain," he remarked.
The decisions follow EWURA's Board of Directors meeting held in Dar es Salaam yesterday to deliberate on the ongoing fuel crisis in the country."According to the EWURA Act, its orders are similar to orders issued by the High Court. Defying the order is equivalent to contempt of court," explained Mr Masebu.He explained that the refusal by oil operators in the country to sell the product was not because of price reductions as they claim but rather due to tightening of regulations in areas where the operators hitherto cheated the government."Other oil dealers that have been involved in disruption of the oil industry should stay warned," said the EWURA DG.
The EWURA boss said fuel adulteration and dumping of transit oil in the local market are among areas where oil dealers used to reap huge profits."But since we introduced fuel marking system we have managed to check the malpractices and they are bitter about this. The pricing mechanism is just an excuse," he remarked.
He noted that since bulk procurement is also in the pipeline, oil traders who used to cheat the government are not happy and thus the disruption.A number of fuel filling stations have for the past few days refused to dispense the precious liquid in protest against a 9 per cent pump price reduction by the industry regulator. The acts by the fuel operators are against the Fair Competition Act of 2003 and EWURA has already forwarded the matter to Fair Competition Commission (FCC) for action.In a telephone interview with 'Daily News' last Sunday, the Director General of Fair Competition Commission (FCC), Dr Geoffrey Mariki, said competition issues in regulated sectors are overseen by the respective regulator in the sector.
"However, the regulator (EWURA in this case) may refer the matter to FCC. If they officially write to us we will take up the matter," remarked the FCC boss.Mr Masebu said during the news conference yesterday that EWURA has written to FCC regarding the matter and forwarded to them evidences against the culprits.
The Director of Petroleum at EWURA, Mr Sirili Massay, stressed that there is no fuel shortage in the country but rather disruptions by oil marketing companies.Meanwhile, the EWURA board granted the Tanzania Petroleum Development Corporation (TPDC) a licence to import fuel.
"TPDC had applied for licence to import petroleum products and operate retail outlets."The board decided that it should be granted a licence for importation. On retail, the board decided that it should be given time to identify filling stations it will be using," Mr Masebu said.
Daily News
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