Wednesday, February 21, 2024

Francistown Oil storage facility expansion halted as NPF probe continues

The expansion of the Francistown Oil Storage Facility has been suspended, thanks to the imminent probe of the National Petroleum Fund (NPF).

The Fund has been centre of attraction since mid December 2017 after a prominent businessman Bakang Seretse, together with two others, Kenneth Kerekang and Botho Leburu were arraigned before the court of law for issues relating to the financial management of the fund monies.

This week, details emerged that an extensive probe of the financial statements of the controversial NPF is at the centre of the suspension of the multimillion Francistown Oil Storage Facility.

As it stands, the work to expand the existing storage capacity for petrol and diesel in Francistown to meet the government’s strategic storage programme has been suspended. It is not yet clear how much impact the suspension will have in the future supply of fuel more especially to the northern side of the country.

However, following a study carried between 2012 and 2014, the government took a decision to expand the storage capacity of the Francistown facility.

This week, the Ministry of Mineral Resources, Green Technology and Energy Security Chief Public Relations Officer Moreri Moesi confirmed that the project was suspended due to lack of funds for immediate implementation.

Sources close to the matter said this week that the project was to be funded partially by the NPF monies which have since been transferred from commercial banks to the central bank.

On the other hand, Moesi further stated that a series of feasibility studies have previously been performed that revealed the critical importance of these initiatives to the economy of the country.  He added that the projects are to address the issue of security of supply of fuel to the country.

“The Francistown bulk fuel terminal expansion project had progressed to the stage of complete design; detailed engineering design. Implementation of this project was scheduled to last at least 24 months,” he stated.

Another multi-million project which is also likely to face short to medium term financial uncertainty due to the NPF saga is the Tshele Hills Oil storage.

The facility has storage capacity of 150 million litres has been described as critical in enabling state owned oil company, Botswana Oil Limited of attaining its mandate of fuel supply security.

On Friday, Moesi said that the Tshele hills project is scheduled to last 36 months from the time of commencement. He added that access road has been completed.

“Construction of access rail is ongoing after it was delayed due to contractor performance, and it is due for completion by March 2018,” said Moesi.

Details relating to the alleged abuse of the NPF monies are expected to be made public when the custodians of the fund are summoned before the Parliament Public Accounts Committee (PAC) in few weeks time.

The matter was referred to PAC in late December 2017 following a motion by Special Elected Member of Parliament (MP) Mephato Reatile which read, “That this honourable house resolves that the Public Accounts Committee meets as a matter of urgency to review the National Petroleum Fund with the assistance of the Auditor General”.

In December 2017, the PAC Chairman Abraham Kesupile told this publication shortly after the motion was passed that his committee will assemble as early as January 2018 to examine the NPF monies.

However, in a brief interview late January 2018, Kesupile indicated that the committee will now only sit in February as some of the constituents of the committee are not yet back from Christmas holidays.

The PAC, which will be working hand in hand with the Auditor General’s office, is likely to summon amongst others Energy Ministry Permanent Secretary (PS) Kgomotso Abi as well as the Botswana Energy Regulatory Authority (BERA) Rose Seretse. It is not quite clear whether the minister responsible for Energy, Sadique Kebonang will be amongst those who will appear before PAC.

Despite the decision by Parliament to have PAC scrutinise the NPF matter, on 5th January 2018 the government announced that it has taken a decision to withdraw the fund monies and investment from banks and investment institutions.

In a short statement issued by the department of Energy, the government indicated that all proceeds into the National Petroleum Fund will be deposited into the Government Remittance account held at the Bank of Botswana.

“All commitment of the Fund shall be routed through the Ministry of Finance and Economic Development for payment through the Government Remittance account”, reads part of the Energy department statement.

The Private sector mouthpiece, Business Botswana then responded by calling on the minister responsible for Finance and Economic Development Kenneth Matambo to issue a public statement regarding the alleged mismanagement of the NPF monies. In his recent budget speech, Matambo however avoided the matter.


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