Mera owes Nocma K219 billion
Malawi Energy Regulatory Authority is failing to pay National Oil Company of Malawi (Nocma) K219 billion for under-recoveries in fuel sales, a development Nocma has said is affecting its fuel import capacity.
Nocma director of operations Micklas Reuben in an interview said the debt has been accumulating since 2018 as a result of a gap between the landing cost of and selling fuel in the country.
He said the fuel is being sold at a cheaper price resulting in a loss, and the gap is supposed to be covered by Mera.
Said Reuben: “It is a historical figure, and it has been building up starting from 2018 to now.
“They remit some money, but the figure has been building and it is now K219 billion.”
He observed that the rise in prices of fuel on the international market and depreciation of the kwacha have contributed to the debt build up.
“At the moment, Mera and Nocma, through the Ministry of Finance and our parent ministry, the Ministry of Energy, are discussing this issue. This is an amount which is coming from the under recoveries that Mera is supposed to give back to Nocma for a product that was landed higher and sold lower, because the prices in the country are lower when you compare to prices that are prevalent in neighbouring countries,” said Reuben.
He said importers are not able to recover their money when selling fuel because of the high landing cost of the commodity.
To make matters worse, Reuben disclosed that the money that Mera owes Nocma belongs to banks.
“It’s not Nocma money. If Mera gives back the money, Nocma will have to pay back to the banks from which we borrow money for buying fuel.
“We are waiting for that money to be paid in order for us to settle the loans and be able to borrow again,” he stated.
When contacted yesterday, Mera spokesperson Fitina Khonje asked for more time.
Meanwhile, Parliamentary Committee on Natural Resources and Climate Change chairperson Welani Chilenga has sympathised with Mera, saying with the landing cost of fuel increasing from time to time, it is difficult for the regulator to effectively honour payments for under recoveries.
“The landing cost is not constant. So we hope that once these issues have been sorted out, when there is stability in landing cost of fuel, Mera should be able to pay those monies. It shouldn’t be a problem at all.
As of now we cannot do otherwise, the landing cost differs from time to time and it is a challenge that Mera cannot run away from,” he said.
