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British firm proposes Zimbabwe fuel link

ZIMBABWE UK-REGISTERED Coven Energy has proposed Sakunda Holdings has a monopoly on fuel
the construction of a $850mn fuel pipeline to supply, while Africa Confidential reported that
provide greater energy security to Zimbabwe, Cove’s proposal “had set [President Emmerson]
which is heavily reliant on the Beira-Feruka link. Mnangagwa and his deputy [Vice President
The second link is seen providing a more Constantino] Chiwenga on a collision course,
cost-effective alternative, through which around with both powerful men angling to safeguard
90% of Zimbabwe’s fuel is supplied. their wealth and political interests”.
The addition of a second pipeline has been Meanwhile, the source added: “The Feruka
under discussion since 2014, but little progress Pipeline does not have the capacity to supply the
was made as the plan was still being evaluated needs of the other Central African nations such
in Harare. In early 2019, several companies as Zambia, Botswana, Malawi and DRC, even to
expressed interest in building such a conduit meet its Polokwane demand. So the justification
under a project estimated to cost more than for a second pipeline is clear. We need about 6mn
$1bn. metric tonnes of fuel every year. Mabvuku is the
Zimbabwe has sought greater investment logical centre to do that. The Coven Energy and
because the landlocked country has faced severe Noic proposal is in the process of being handled
shortages of petroleum products, partly caused by [Zimbabwe Investment and Development
by transport constraints and scarcity of foreign Agency (ZIDA)] on behalf of the Government
exchange required to finance imports, leading to of Zimbabwe. It will be implemented as a JV.” ™
long queues at fuel stations.
Speaking to The Zimbabwe Mail, a source
with close knowledge of Coven’s proposal said:
“This is a complicated and rather confiden-
tial project given the conflicting interests. The
Feruka pipeline now is underutilised because
it is overpriced. The reason for that relates to
the people who control the pipeline in Mozam-
bique. This is something that has to be attended
to in the short term.”
Longer term, Coven would seek to connect
the pipeline to South Africa, Botswana, Zambia,
Malawi, and the Democratic Republic of Congo
(Kinshasa).
The mention of “conflicting interests”
presumably refers to the delicate balance of
power in Zimbabwe’s energy sector. At pres-
ent, sanctioned businessman Kuda Tagwirei’s Zimbabwe is currently dependent on the Beira-Feruka fuel pipeline (Image: NOIC)

INVESTMENT
Overdue bills may be driving Sonangol’s

decision to sell some offshore assets

ANGOLA ANGOLA’S national oil company (NOC) its share of the funds needed for exploration and
Sonangol has reportedly fallen far behind on its development work. The company “hasn’t paid
financial obligations to its foreign partners. cash calls for a while,” the source said.
Industry sources told Reuters last week that The NOC has been especially hard-pressed
the NOC owed about $1bn to the international to cover its share of costs for certain complex
oil companies (IOCs) that have invested in projects, said another source in the banking
Angolan projects. They did not divulge specific sector. “Sonangol has been unable to meet its
details about the debts, but one oil company financial requirements in some of the blocs most
source said that Sonangol had not been covering needing investment,” the source stated.

Week 27 07•July•2021 www. NEWSBASE .com P7