BERA Rejects BOL's Application

Staff Writer | Monday May 14, 2018 14:18

Earlier BOL had applied to be granted an exclusive import licence for petroleum, but BERA rejected it, stating that they failed to show their financial and technical capability.

According to the Authority, BOL has failed to make out a case to demonstrate the necessity of an exclusive licence giving them a choice to appeal the decision if they are not satisfied with the decision.

“BOL may if dissatisfied with this decision appeal to the High Court within 30 days from the date of receipt of the decision,” a statement from BERA read.

The Authority has stated that BOL has failed to submit a business case in support of the proposed change in the current arrangements for the importation of petroleum and petroleum products in the country making it difficult to assess the costs and benefits of the proposal.

“This failure does not help BOL’s position that they are financially capable of being the sole importer because in the absence of such, their application is based on speculation,” it further read.

They stated that BOL does not have sufficient storage capacity to secure 60 days’ uninterrupted supply as contrary to the submissions made by the applicant, government’s planned bulk petroleum products storage programme clearly indicates that the construction of the Tshele Hills project, expansion of the Francistown Depot and development of the new storage depot would only fulfill the 60 days’ stock cover by the year 2022.

Further, the Authority noted that BOL does not have the requisite capacity to be the sole importer even though government has mandated them to manage strategic storage facilities. They also noted that BOL has failed to demonstrate that there are no other alternatives that could be employed to attain the same objectives without the issuance of an exclusive licence.

“The manner form proposed by BOL for a quota of 50% in an exclusive licence, which they have admitted will ipso facto entitles them to 100% share market of the import that same phased, initially giving them 50% supply while IOC’s are given six months to renegotiate their agreements preparing to exit the import market.

According to BERA, BOL might be on the right track towards citizen empowerment. Unfortunately, however, it is lacking in terms of figures that project impact and number of opportunities that might arise. In addition, they noted that it remains difficult for the Authority to establish with certainty whether or not the intended empowerment would impact the country, as benefits remain speculative.

An exclusive licence would have granted BOL 100% rights not shared by anyone else except by their own operations.