Sahara Energy fate in hands of Petroleum Bulk Procurement Agency's board.

16Jan 2016
The Guardian Reporter
The Guardian
Sahara Energy fate in hands of Petroleum Bulk Procurement Agency's board.

The newly established Petroleum Bulk Procurement Agency board of directors will decide the fate of Sahara Energy Resources Limited, which supplied the country with substandard petrol which has since been rejected.

TBS Director General Joseph Masikitiko.

PBPA General Manager Michael Mjinja told The Guardian on Saturday yesterday that the board would soon meet and decide on how to address the violation of a contract signed between the two parties when Sahara Energy won a bulk procurement tender last December.

“The board will make a decision according to the terms of the contract, which will then be announced to the public,” Mjinja said when responding to questions regarding the fate of the Lagos-based company.

According to Bulk Procurement System regulations, a supplier who defaults on regulations by importing poor quality products is punished by not more than six month suspension and a US$ 0.5 per ton penalty.

In 2013, Geneva-based Addax Energy SA was suspended from participating in four tenders for importing petroleum when it fell short of BPS specifications as determined by the Tanzania Bureau of Standards.

Sahara, whose oil tanker, MT Alexander Ridgebury carrying 37,000 metric tonnes of petrol, arrived at Dar es Salaam port on December 25, last year, and was denied permission to offload the fuel by the Tanzania Bureau of Standards because of quality concerns, has been ordered to re-supply the same at current prevailing global oil prices.

“As per contract, they have to import the product as per specifications,” Mjinja stressed.

PBPA, which replaced Petroleum Bulk Importation Coordinator Limited with effect from January 1, 2016, is a quasi government agency with a combined private sector and ministerial representation.

While the PIC was a private sector company with oil marketing companies as shareholders, PBPA is public.

Sahara Energy won the BPS tender last December by offering the lowest price of US$ 43.599 per metric tone, beating Addax Energy SA which quoted US$ 43.657; August Energy SA with an offer of US$ 43.912; Gapco Kenya which quoted US$ 43.938, and Enoc Africa Limited with US$ 43.840 per metric tonne.

TBS Director General Joseph Masikitiko ordered the ship carrying the substandard petrol to leave Tanzanian waters last week following laboratory test results which found out that the fuel had high lead content and was possibly blended with ethanol.

The BPS was introduced in 2011 but started in 2012 and since then there have been 41 international competitive tenders floated, of which less than five had serious quality problems requiring suppliers to withdraw their consignments.

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