A citizen-owned Botswana company, Shamiz PTY Limited, has filed a P13,052,940.87 law suit against Engen Botswana for breach of contract.
Engen allegedly pulled out of a contract with Shamiz to set up a petrol filling point at or near Ramokgwebana border to service customers from the Republic of Zimbabwe “taking advantage of the economic crises then prevailing in Zimbabwe”.
Shamiz intended to sell fuel in quantities of not less than 200 litres per unit at wholesale price. They projected a profit margin of 15t per litre of fuel sold.
Projected monthly sales were estimated at between three to four million litres of fuel and Shamiz anticipated a monthly net income of between P450,000 and P600,000. This against its projected monthly overheads of P100,000 and a monthly net profit of about P430,000.They would have been the exclusive wholesale supplier of the fuel products at Ramokgwebana.
Engen Botswana will further submit that they were impressed by Shamiz’s proposal and they verbally communicated its acceptance of the project to Shamiz.
Steps were taken to satisfy preliminary requirements for an agreement:
* Appointment of AF Pump and Tank, a firm of engineers as project managers who rendered advice relating to the proposed construction of the site.
* Engagement of William Lee Associates to carry out a topographical survey of the site and liaise with all the relevant stakeholders including the departments of roads regarding leave ways and other related issues.
* Instructions to attorneys Osei Ofei Swabi and Company to register a notarial deed of lease over tribal lot 34 in Jackalas No1 intended to house the fuel infrastructure facility and that was done.
Shamiz, on the other hand, managed to secure a loan from CEDA to the amount of P1,000, 000 on the basis of its financial prognosis set out in an annexure to finance the project and procured architectural and structural drawings which were approved by Engen Botswana experts for use at the site.
Following these developments and negotiations between Engine and Shamiz, on or about May 2007 in Gaborone, an agreement was entered into by the two parties providing for the proposed construction of the fuel point infrastructure at Ramokgwebana to be operated by the two parties with. Engen Botswana was appointed as the sole wholesale supplier of fuel products to Shamiz in the Ramokgwebana for a period of 10 years.
The Engen Botswana standard supply agreement was availed to Shamiz and it was signed by one of its directors and a copy was returned to Engen Botswana though a signed copy was never availed to Shamiz despite repeated.
On 24 October, 2007 Engen Botswana confirmed the existence of a trade agreement between it and Shamiz. Further that there is a trade agreement entered into verbally and later reduced to writing between Engen Botswana and Shamiz.
After these procedures, the managing director of Engen Botswana advised Shamiz that they are pulling out of the agreement saying it is no longer interested in the Ramokgwebana project.