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DMEA PIPELINES DMEA
Malawi still hunting for pipeline backing
AFRICA
THE government of Malawi said this week that it still hopes to build an oil pipeline that has been in planning for more than a decade, noting that it requires an investor for the project.
Speaking to local media this week, Ministry of Energy (MoE) spokesperson Upile Kamoto said that an investor continues to be sought to back the construction of an oil conduit running from either Beira or Nacala in Mozambique to Malawi’s second city, Blantyre.
It had previously been envisaged running to the border town of Nsanje, but Kamoto said that Blantyre was chosen owing to the city’s higher density of oil marketing company offices and fuel storage facilities.
She said: “Since 2010 the ministry has been trying to find an investor to conduct feasibil- ity study, design and construct the pipeline.” Kamoto noted that the line is expected to be con- structed under a build, own, operate and transfer (BOOT) arrangement.
“There is no breakthrough in terms of finding an investor or finances for the project,” Kamoto added.
With a feasibility study yet to be completed, she did not provide an estimated cost for the
project, but referenced a World Bank study, which gave an indicative price of $64,300 per inch to construct such a pipeline in sub-Saharan Africa, adjusting for terrain and labour costs. However, previous studies estimated the total cost of the project at $150mn.
Expressions of interest (EoIs) were sought by the MoE in 2010 following completion of a prefeasibility study by Qatari firm Vanessia Petroleum.
This envisaged a pipeline with a capacity of at least 900mn litres per year of diesel, gasoline and paraffin, with the Malawian government for LPG and crude to flow through it too. Their inclusion would be predicated on the construction of a refinery at Nsanje, which has never materialised.
Hopes for the pipeline appeared to have been dashed in 2017 amid reports that the govern- ment had accepted it would never happen.
Meanwhile, in July, a joint effort by British and Zimbabwean companies began imple- menting an agreement to import and distribute petroleum products into the southern African country via Beira, with future plans to expand into the Democratic Republic of Congo, Zambia, Botswana and Malawi.™
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