Local News

Ewura finally orders action against ‘foul’ fuel importer

EWURA Director General, Mr Haruna Masebu.

ENERGY and Water Utilities Regulatory Authority (EWURA) has finally directed the Petroleum Importation Coordinator (PIC) to take action against Augusta Energy SA for supplying poor quality petrol through bulk procurement system (BPS) between January and March, this year.

The industry watchdog made the directive in a letter dated June 5, 2012, addressed to the PIC General Manager and copied to the Permanent Secretary in the Ministry of Energy and Minerals. "The authority is of a view that since the relationship between the supplier and PIC is purely contractual, the PIC should exercise its rights under the Shipping and Supply contract," according to the letter signed by EWURA Director General, Mr Haruna Masebu and seen by the 'Daily News' on Thursday.

The directive follows confirmation by the Government Chemist Laboratory Agency (CGCA) recently that petrol supplied during the period contained ethanol at levels that were higher than the Tanzania Bureau of Standards (TBS) specification of 9.5 per cent.
Oil marketing companies had in April, this year, accused Augusta Energy SA, the supplier of petroleum products through BPS, of delivering poor quality petrol during the first quarter of this year.

The Swiss-based Augusta Energy SA won three successive tenders to supply oil through BPS from January to June, this year, with each tender covering two months. Reached for comments yesterday, the PIC General Manager, Mr Michael Mjinja, said the firm's board of directors had met and deliberated on the matter.

"The board directed us (the management) to communicate with TBS regarding the initial tests and provide us with the certificates of quality before we advise the board on the way forward," Mr Mjinja said. Mr Mjinja said once the PIC got feedback from TBS regarding the quality of petrol it would act on the matter right away.

Following complaints by oil marketing companies last April, EWURA intervened in the matter by collecting samples from various sources and forwarded them to the CGLA for quality analysis. Laboratory reports of the said analysis showed that the products contained ethanol higher than the TBS specification of 9.5 per cent, according to the letter.

"It was then decided to test samples of gasoline from 11 thips that were berthed at Dar es Salaam port during the period for laboratory analysis. "The results of the analysis conducted by the chemist show that out of the 11 samples that were analyzed, 10 had ethanol content which was above the level that is specified in the TBS standard," the letter reads in part.

Adding; "However, PIC is cautioned that in whatever action that you will take, you should take into account that supplies were delivered under CIF (cost, insurance and freight) contract and the need to ensure the continued supply of petroleum products."
Augusta Energy Managing Director, Giuseppe Nestola, said in a letter dated April 11, 2012, addressed to PIC and copied to EWURA, that the disputed fuel had legally acceptable levels of oxygen content of not more than 1.04 per cent which many oil marketing companies imported prior to commencement of bulk procurement.