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Russia Will Help Mozambique to Stabilize Fuel Prices

Russia has said it was open to working with Mozambique to reduce, by half, the cost of petroleum products in the country’s filling stations.

Alexander Surikov. Russian Ambassador to Mozambique, said his country would “allow Mozambique to start importing fuel directly from Russia, avoiding intermediaries, potentially reducing by at least half the costs of acquiring the products”.

Russia is wooing friends all over the world as the European Union imposes sanctions on it in the wake of its invasion of Ukraine, which has pushed up crude oil prices and exacerbated global supply change challenges. Africa has become a key site in the contest of will between Russia and the west.

″Russia is open to working with Mozambique in this regard”, Surikov declared at a consultation meeting with the Confederation of Economic Associations of Mozambique (CTA), “We are open to projects in the fuel sector and in others of mutual interest.” he said.

Mozambique has had to deal with skyrocketing prices of petroleum products. The Mozambican Energy Regulatory Authority (Arene) announced the third fuel price rise in 2022 on July 1.

The sharpest rise was for LPG cooking gas for which a kilo of gas leaped by 19.28% from 85.53 meticais to 102.02 meticais; the price of a litre of diesel rose by 11.4% from 78.97 to 87.97 meticais. For gasoline the increase was 4.4%, from 83.3 to 86.97 meticais a litre. This is the first time that diesel has become more expensive than petrol at Mozambican filling stations.

The price of a litre of kerosene rose from 71.48 to 75.58 meticais, which is an increase of 5.74%.


Egypt Raises Diesel Price to Curb $3Billion Subsidy Bill

The Egyptian government has raised the price of diesel for the first time in three years, hoping to reduce its subsidy bill by 13% as global energy prices head north.

The action effectively adds diesel to the basket of petroleum products whose prices the government has raised, in the context of the ongoing global energy crisis.

Egypt is one of Africa’s largest energy-subsidy economies. The government subsidises piped natural gas to households; prices of gasoline and cost of diesel.

Egypt’s pricing committee has routinely raised the price of gasoline in the last 18 months, but it had not included diesel: the main fuel used in public transportation as well as transportation of commodities.

Egypt uses diesel in transportation than it uses gasoline contrary to many other countries.

The fuel pricing committee increased the price of diesel to 7.25 Egyptian Pound (EGP7.25) per litre from EGP6.75, as well as hiked petrol prices by up to 10%, the Petroleum Ministry said in a statement The new prices went into effect immediately and will remain unchanged until the beginning of the fourth quarter 2022.

North Africa’s largest economy and the Arab World’s most populous state had absorbed the extra cost of diesel after global fuel prices shot up on the back of the Russia-Ukraine war — and was facing an annual diesel subsidy bill of $3.3Billion EGP 63Billion, according to Mostafa Kamal Madbouly, the country’s Prime Minister. A liter of diesel had cost EGP 11 on average since April 2022, of which EGP 4.25 was subsidized by the government, costing it $285Million (EGP 5.4Billion), Mr. Madbouly explains, adding that the little hike should reduce the state’s subsidy bill to $2.9Billion (or EGP55Billion).

Gasoline (petrol) prices also rose as follows

95-octane is EGP 10.75 per litre, up 10.3% from EGP 9.75;

92-octane is EGP 9.25 per litre, up 5.7% from EGP 8.75;

80-octane is EGP 8.00 per litre, up 6.6% from EGP 7.50.

Mazut fuel oil prices rose by 8.7% to EGP 5,000 per ton for all industries except food and electricity producers, who continue to be charged EGP 4,200 per ton.

This is the sixth consecutive quarter petrol prices have risen. The price at the pump is now up 23-28% since last April, depending on which grade you’re putting in the tank.

But the country has a dilemma of declining value of its currency against the American dollar, meaning that prices, even as they have adjusted, remain far below global market levels. What’s more: foreign reserves have plummeted to 5-year lows, as subsidy spending surges.

“These new price increases were substantially less than the 13% fall in the value of the Egyptian pound against the US dollar over the previous quarter (from $1=E£16.1 to $1=E£18.5)”, reports MEES, a industry trade journal which publishes weekly analyses of the Middle East’s oil and gas developments. “As such the latest prices are actually lower in dollar terms than those three months earlier. Indeed, in dollar terms the latest gasoline prices are only fractionally higher than those two years earlier at the height of the COVID 19-induced slump in oil demand when global oil prices were well under half current levels”, MEES says.

 


Zambia Commences a $1.5Billion Diesel Pipeline to Tanzania

Zambia has begun building the first phase of a 1,700-kilometre-long pipeline to pump diesel fuel from neighbouring Tanzania, with an initial investment of $300Million.

“Phase one of the pipeline will end in Mpika (District in northern Zambia), phase two in Ndola (in Copperbelt Province) and phase three in Solwezi (in northwestern Zambia)”, Peter Kapala, Zambia’s Energy minister, said on a live radio broadcast July 3, 2022.

“In a few months’ time”, Kapala declared, “the pipeline will start pumping diesel fuel into Zambia”.

The minister did not provide any details for the second and third phases of the project.

The new pipeline will have more advanced specifications than-but will run alongside- the Tazama Pipeline, a 54-year-old, 1,710-kilometre facility that transports raw material for refining from the port of Dar es Salaam in Tanzania to the Indeni Petroleum Refinery in Ndola, Zambia.

The project will be pivotal in the country’s long-term goal of stabilizing diesel supply and maintaining favourable pump price, the minister adds.

A litre of diesel in Lusaka, the Zambian capital cost around $2 as of Sunday, July 3, 2022.

Plans to construct a new pipeline to complement the Tazama infrastructure, which is suffering integrity issues, has been on the table for a while. The new government headed by Zambian President Hakainde Hichilema, less than 12 months in office, put the project right back on the front burner.

Zambia’s current daily diesel consumption hovers around two million liters, with the main consumer being mines, and the country’s supply level has remained fairly stable despite the challenges of the war in Ukraine.

 

 


BP Divests a Strategic, Fuel Storage Terminal, to a Black Owned South African Company

British Petroleum Southern Africa (bpSA) has sold one of its 100% owned liquid bulk fuels import terminals to black women-owned and managed independent petrochemicals company Wasaa in what is regarded as a landmark transformation deal.

The terminal is located at the Port of East London, in South Africa’s Eastern Cape Province.

Prior to the sale, bpSA had six fuel storage terminals, two 100% owned by bpSA, (one of which is now sold); two (Alrode and Pretoria) jointly owned with Sasol (50/50); one (Island View) jointly owned with Shell (50/50) and one (Rustenburg) owned by Astron (⅓), bpSA (⅓) and Engen (⅓). We invest in our terminal infrastructure to provide world class road and rail gantries, fire-fighting capability, tanks and pipelines.

Johannesburg-based Wasaa is a subsidiary of the Wasaa Group, which was founded and is led by Nokwanele Qonde, aranking South African female entrepreneur.

In line with the agreement, Wasaa Terminals has also acquired 100 percent of the terminal’s movable assets and a 20 percent stake in the berth to terminal pipeline. Sout Africa’s top finance website Moneyweb reports that Wasaa Terminals began taking over terminal responsibilities on December 6, 2021.

bpSA will retain the operations of its transport business operating outside of East London. Wasaawill provide terminal storage and handling services to bpSA in the Eastern Cape port city.

 

 


Unusual Spike in Methanol Found in Gasoline in Nigerian Market

PRESS RELEASE

The Nigerian Midstream and Downstream Petroleum Regulatory Authority (The Authority) wishes to inform the Nigerian public that – limited quantity of Premium Motor Spirit (PMS), commonly known as Petrol, with methanol quantities above Nigeria’s specification was discovered in the supply chain.

Methanol is a regular additive in Petrol and usually blended in an acceptable quantity.

To ensure vehicular and equipment safety, the limited quantity of the impacted product has been isolated and withdrawn from the market, including the loaded trucks in transit Our technical team in conjunction with NNPC Ltd and other industry stakeholders, will continue to monitor and ensure quality petroleum products are adequately supplied and distributed nationwide.

The source supplier has been identified and further commercial and appropriate actions shall be taken by the Authority and NNPC Ltd.

NNPC Ltd and all Oil Marketing Companies have been directed to sustain sufficient distribution of Petrol in all retail outlets nationwide.

Meanwhile, NNPC has intensified efforts at increasing the supply of Petrol into the market in order to bridge any unforeseen supply gap.

Issued by:

Nigerian Midstream and Downstream Petroleum Regulatory Authority (The Authority)  8th February, 2022.

 


Nigerian Government Will Keep Gasoline Import Subsidy in Place, Beyond July 2022

The Nigerian government has suspended its plan to remove subsidy on petroleum products in July 2022 as, according to the Minister of Finance, “the timing is problematic”.

Zainab Ahmed said that the Government made provisions for subsidy in the 2022 budget from January to June 2022, and “all payments on fuel subsidy ordinarily would cease as from July, 2022”. She disclosed that efforts are underway by the Executive arm of government to forward a request to the National Assembly to make additional provision for fuel subsidy from July 2022,  “till a time deemed appropriate for its eventual removal”. Ahmed, speaking at a meeting which involved Timipre Sylva, Minister of State for Petroleum Resources, Ahmed Lawan, the country’s Senate President, as well as Farouk Ahmed, Chief Executive Officer of the Nigerian Midstream and Downstream Regulatory Authority, Mele Kyari, Managing Director of the Nigerian National Petroleum Corporation, and Gbenga Komolafe Chief Executive Officer of the Nigerian Upstream Regulatory Commission, explained that the provision in the budget to end subsidy by the end of June 2022 was made in deference to the Petroleum Industry Act, passed in August 2021, which includes a provision that all products will be deregulated.

“Subsequent to the passage of the Act, we went back with an amended the Fiscal Framework that was submitted to the National Assembly to incorporate this demand, but after the budget was passed we have had consultations with a number of stakeholders. It became clear that the timing is problematic, that practically there is still heightened inflation, and also removal of subsidy will further worsen the situation, thereby, imposing more difficulties on the citizens, and Mr. President clearly does not want to do that”. She said that “what we have to do now is to continue with the discussions we are making, in terms of putting in place a number of measures, one of which is the deployment of an alternative to the Premium Motor Spirit (PMS) and also the roll out of enhanced refining capacity in the country, including the 650,000 barrels per day Dangote refinery and also the rehabilitation of the four national refineries that have a combined capacity of 450,000 barrels per day”.

 

 


Bolloré May Sell African Logistics Assets to MSC

French logistics group Bolloré has received an offer from the Mediterranean Shipping Company (MSC), a Switzerland based operator in container transport and logistics, to acquire 100% of Bolloré Africa Logistics, comprising of all the Bolloré Group’s transport and logistics activities in Africa, based on an enterprise value, net of minority interests, of €5.7Billion.

Bolloré says it has granted the MSC Group an exclusivity until 31 March 2022 “to submit a put option”. Closing this sale will then require obtaining regulatory authorisations and the approval of the competent competition authorities.

“The Bolloré Group has decided to study this offer, which protects jobs and preserves its projects and commitments on the continent. It remains fully convinced of the potential of Africa, where it will continue to be actively involved in television (Canal+, MultiChoice), communications, entertainment, publishing and as a broadband internet access provider”, the group says in a statement. “The Bolloré Group reaffirms its commitment to invest and expand in the region.

“The two groups share many similarities. MSC is a European family group with a long-term vision that places its employees at the heart of its business strategy.

“The MSC Group has made significant investments in Africa in recent years and has great ambitions for the African continent. Its investment capacity, resources and market expertise would provide a new impetus to the projects that the Bolloré Group has designed, built and developed.

This transaction, if it comes to fruition, will not be completed until several months later*. The satisfaction of the Bolloré Group’s customers and partners remains a priority and, therefore, Bolloré Transport & Logistics will continue to honour its commitments by pursuing its projects, its investments and its goal to develop logistics ecosystems in Africa.

The Bolloré Group will ensure that its transport and logistics activities concerned with the MSC group’s offer continue to act independently of MSC so long as the competent authorities have not approved this project.

*MSC has an exclusivity period until 31 March 2022

 

 


Chinese Coal Imports from Mozambique, South Africa, in a Historic Surge

Export of coal from Mozambique and South Africa to China has leaped to a historic high in 2021, as the world’s second largest economy buys from new sources to deal with a global coal shortage.

As the market has tightened, China started importing from these two countries, which are not its non-traditional markets, like South Africa and Mozambique and expanded its trade with existing trading partners, including Myanmar Colombia and Kazakhstan.

China’s trade in coal with Mozambique and South Africa has a history. The Asian giant returned to import from South Africa years after it stopped as a result of problems with the chemistry of South African coal. Imports from South Africa, mostly used for coal to power generation, moved from zero in December 2020, to 1 Million tonnes in April 2021.

China’s coal trade with Mozambique was active between 2011 and 2014, when it stopped. It was restarted in February 2021. Monthly imports from Mozambique reached 174,000 tonnes in April, the highest level on record, according figures quoted by South China Morning Post.

 

 


Egypt Increases Pump Prices of Gasoline

Subsidy-minded Egyptian government has increased pump prices of petroleum products for the second consecutive quarter.

 The government raised fuel prices by up to 3.8%, in response to rising international oil prices. This means that motorists will now pay an extra 0.25 Egyptian Pound (EGP) per litre for 95, 92 and 80 octane gasoline during 3Q 2021.

Fuel prices have now risen 5.9-8% so far this year after the fuel pricing committee effected the first increase at the beginning of the second quarter of 2021.

Diesel and mazut prices remain unchanged.

Gasoline prices, from July 23, 2021:

• 95-octane has moved up 2.9% from EGP 8.75 to EGP 9 per litre.

• 92-octane has moved up 3.2%, from EGP 7.75 to EGP 8.

• 80-octane has moved up 3.8%, from EGP 6.50, to EGP 6.75.

Prices of mazut fuel oil for use in factories will remain at EGP 3.9k per tonne, while diesel prices are still EGP 6.75 per litre.

These prices will remain fixed until through 3Q 2021 and will be reviewed again by the fuel pricing committee at the beginning of 4Q in October.

Crude oil prices have been on a run, increasing by close to 45% in 2021, as the global economy recovers.


ExxonMobil to Sell CNG in its Fuel Stations in Egypt

Gastec and Cargas, two Egyptian government owned gas suppliers, have signed a cooperation protocol for adding facilities to supply natural gas inside ExxonMobil fuel stations in the country.

The three parties will start the first phase of establishing facilities for supplying cars with compressed natural gas (CNG) in an average of 50 stations, followed by another phase targeting ExxonMobil stations across Egypt, according to the agreement.

By getting ExxonMobil to include CNG supply, Egypt is involving a key fuel retailer in its plan to increase the usage of natural gas in the country.

ExxonMobil is one of the biggest fuel retailers in Egypt, with more than 350 service stations and more than 25 convenience stores, christened On the Run.

The company claims to be the market leader in petroleum product technology in North Africa’s largest eonomy, offering its clients “highly recognized lubricants, industrial greases and expert lubrication programmes and services”, and now, at the behest of the government, it has to include CNG.

In what it calls the natural gas transition, the government is setting up a financing programme through the country’s banks to extend $77Million (or EGP 1.2Billion) in low-interest loans for car owners to convert their vehicles to run on dual-fuel engines; see 150,000 cabs and minibuses outfitted with dual-fuel engines over the course of three years and set up infrastructure in seven governorates to accommodate engines running on natural gas in the first phase, with the remainder of the programme to be expanded to the rest of the country.

 

 

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