Big petroleum companies rope in private dealers

SOME big petroleum firms are now letting most of their retail sites to private dealers in line with Government’s vision to promote broader participation by locals in the fuel sector.

Industry players said companies such as Puma Energy, Sakunda and Total have released some of their retail sites to other dealers who are now managing the service stations.

This effectively means the role of large companies is now largely limited to bulk fuel procurement.

This comes at a time when the Gov- ernment is in the process of crafting a law that will prohibit licensed bulk fuel importers from holding retail licenses. “Most of the companies have already released some of their retail outlets to private dealers,” said one source.

“The dealers are now doing the retail; buying from large corporations who are now main into wholesale. It is a form of empowerment while at the same time reducing the dominance of large corporations on the local petroleum market,” the source added.

Efforts to get a comment from Energy and Power Development Dr Samuel Undenge proved fruitless.

In April, Zimbabwe Energy Regulatory Authority chief executive Engineer Gloria Magombo said the proposed legislation is meant to create a situation where one either holds a retail or a wholesale licence.

She said while bulk fuel importers could own retail sites, they should release them to private retailers to allow boarder participation of locals.

“That is being addressed by the Ministry (of Energy and Power Development),” he said.

“Government is actually working on that policy position, so there will be definitely some announcements soon, but that’s a ministry issue.

“The Minister is seized with the issue.

After the adoption of the multi –currency system in early 2009, there was huge investment appetite for Zimbabwe’s fuel sector as foreigners, some of whom once had operations in the country, returned onto the market due to the lower risks associated multi-currency system.

At that time, the country also witnessed tremendous growth in fuel consumption driven by high vehicle imports mainly from Japan.

Some of the notable transactions, which saw the acquisition of local outfits by multinational fuel companies, were the takeover of Redan and Sakunda by Puma Energy.