Malawi Government has acquired land for the construction of strategic fuel reserves in Blantyre, Lilongwe and Mzuzu which are expected to increase the amount of fuel buffer stocks from 12 days to 30 days, authorities have said.
Minister of Energy Ibrahim Matola speaking in Traditional Authority (T/A) Kapeni in Blantyre on Wednesday when he toured the acquired land, said the strategic reserves will increase the country’s fuel stocks from 12 days to a month and consequently reduce possible fuel stock-outs due to shocks.
The project which the minister acknowledged has stalled for some time, is expected to be implemented in 18 months.
Matola noted that at the moment, the country fuel stocks are predominantly those in trucks and filling stations, a situation he said is a risk if a problem occurred along the country’s import routes.
“A bill was passed in Parliament authorising the Malawi Government to get a loan from Export and Import (Exim) Bank of India. There will be three reserves constructed under the project, in the South and the Centre with 25 million litres each and the North, 10 million litres.
“Through the benefits that we will get from the fuel reserves through levies, we will be able to meet the loan and the taxpayer will not suffer through repayment. We shifted from Kameza in Blantyre because of safety reasons and that is why we have delayed,” said Matola.
He added that the National Oil Company of Malawi(Nocma) will be handed over other fuel reserves from Malawi Energy Regulatory Authority (Mera) in Mchinji and Chipoka but these are small reserves.
Nocma chief executive officer, Robert Mdeza, speaking at the site in an interview, said the role of the new oil company is to coordinate the project with the key ministries including the Ministry of Finance which acquired the loan.
