Sahara Energy ordered to clean tanks, stop importing oil

29May 2016
Aisia Rweyemamu
Guardian On Sunday
Sahara Energy ordered to clean tanks, stop importing oil

THE government yesterday cancelled all tenders to import fuel in the country by Sahara Energy Limited and ordered the firm to immediately clean up fuel tanks of three oil companies it tainted with contaminated imported JET A1 oil.

Minister for Energy and Minerals Prof Sospeter Mhongo (2rd L ) speaks to Oryx General Manager Godfrey Fernandes on an inspection tour of petrolium depots in Dar es Salaam, yesterday. Photo: Michael Matemanga

The move clears doubts in the ongoing debate in the media that had surfaced in Parliament regarding the tainted JET A1 oil which was imported by the Nigerian firm.

The Minister for Energy and Minerals, Professor Sospeter Muhongo gave the orders during a visit to Puma Energy offices, along with Oilcom, Oryx and GAPCO where he received complaints of receiving tainted JET A1 fuel from Sahara Energy.

Earlier this month the firm supplied the said fuel to the four firms which had until yesterday not been supplied to receivers due to fears that it is tainted.

The situation brought the government to intervene while directing that Sahara Energy fuel deals to be cancelled, and ordering it to clean up its oil tanks.

“Effective today, I order Sahara Energy to clean all tanks to allow the tanks to receive new cargo next week,” he told oil company officials.

He emphasized that the firm would be proscribed from doing business in the country if the cleaning will not be done.

The clean up exercise is to start today, he maintained, elaborating that the government will not entertain dubious business deals and squabbles between the firms.

“The government will not wait for academic arguments of labs to prove the quality of the fuel. We know the fuel is not suitable for utilization,” the minister intoned.
“We will therefore waste no time arguing,” he stated.

Even if the clean up business will be completed Sahara will not be allowed to importing fuel in the country until further investigations because this is the second time the company imports contaminated fuel.

Felix Ngamlagosi, director general for the Energy and Water Utilities Regulatory Authority (EWURA) explained that on May 4 Sahara Energy shipped a stock of fuel in the country which upon arrival was tested by the Tanzania Bureau of Standards (TBS) which found the oil suitable for utilization.

On May 12 the companies that received fuel lodged complaints that the oil was contaminated and cannot be utilized, he said.

The fuel was contaminated when pumped out from the ship where the two pipelines (petrol and Jet A1) were pumped out together, and during that process the petrol and Jet oil were mixed, he further stated.

He assured the public that despite that confusion the country has enough Jet fuel to be used for 14 days from today.

Puma Energy is also expecting to receive a new cargo of Jet oil before June 7, he said, noting that currently the country depends on Jet oil from Total Oil Co. and SP Rwanda who received fuel from another supplier.

Haruna Magota, the Oilcom project engineer and aviation operations manager told the minister that on May 5 the firm received 8.8milion liters of Jet fuel which were stored in their tanks with a capacity for 12m litres asd each tank takes 6m liters.

“It was bad luck that after testing the oil in the laboratory we found that the fuel is not suitable for use, but the responsible company (Sahara Energy Limited) has a negative response to this,” the manager told minister.

At OilCom company officials explained that more than 10.8 million liters worth Tsh10.8bn is contaminated as tanks had remained with a stock of 2.6 jet fuel, “therefore we are not in a good situation. Due to this as we depend on supplies from Total Oil company to feed our clients,” he said.

GAPCO received 2.8milion liters worth Tsh2.9 bn and PUMA Energy received 14.4 m liters worth Tsh14.4 bn, and both companies complained of contaminated Jet fuel which is stored in their tanks, making them to not be able to receive new fuel cargo as the tanks still hold plenty of residue of contaminated Jet oil.

Sahara was said to have been warned that the ship they used for importing the oil was not safe for that business but they ignored the warning.

Sahara Energy Limited sent a team of three experts who told the minister that they have collected new samples to be tested in the laboratory, requesting the minister to wait for the new laboratory results. The request was ignored by the minister.

The government has also asked the company to bring the contaminated fuel at the Tanzania International Petroleum Reserves Limited (TIPER) where there are enough empty tanks that can be used to store the oil.

The decision comes after Sahara Energy Limited complained that they do not have room to store the fuel after the clean up business.

However, Sahara had earlier this week denied any responsibility saying prior to offloading the fuel was certified by the Tanzania Bureau of Standards (TBS). Company spokesman Bethel Obioma said that sabotage might be behind the contamination.

In a statement, Obioma said a joint probe team should be formed to re-test samples from all four companies’ facilities to establish the quality of the product and find out where contamination might have happened.

However, the Oil Marketing Companies (OMCs) demanded proof that there was a conspiracy for sabotaging the importer who was accused of bringing in contaminated Jet A1 fuel. The Tanzania Association of Oil Marketing companies (Taomac) challenged Sahara Energy Resources Limited to name whatever saboteur it knows to have interfered with their oil cargo.

Last January, the same company was ordered to withdraw 37,000 metric tonnes of petroleum products imported under the bulk procurement system (BPS) after TBS tests indicated that the fuel was substandard.

The company was however not suspended from participating in BPS tenders as required by regulations.