On Tuesday, BERA officially awarded Botswana Oil (BOL) the first substantive fuel import licence, as part of a legislative change under which the parastatal takes over 90 percent of the country’s fuel imports.
Effective April 1, BOL is responsible for importing 90% of the country’s 1.3 billion-litre per annum fuel demand and on-selling this to the existing multinational oil companies that are operating in the country and have previously imported for themselves. Citizen companies will have the right to import the outstanding 10%.
Documents seen by BusinessWeek indicate that 14 other majority citizen firms have been allowed to continue importing fuel between now and September while finalising their substantive licences from BERA.
Speaking during a brief ceremony to hand over the import licence to BOL, BERA caretaker CEO, Grace Tabengwa said the firms would continue importing fuel under the transitory period.
“All import licences previously issued by BERA have become defunct and companies can re-apply for import licences according to the regulations,” she said. “The authority has allowed some majority citizen-owned companies that have been importing to continue from April 1 for six months while they apply to be relicensed. “This is a transition period.”
BOL CEO, Meshack Tshekedi, said BERA had proved impartial in the process it took to grant BOL an import licence.
“It’s been a journey of many months,” he said. “It’s been a lot of work for both us and the regulator. “I need to assure you that we have an impartial regulator and they have been tough on BOL. “We are thankful for that because it guided us to make sure we are ready for this important milestone.”
Tshekedi said the oil industry shake-up was critical in boosting the country’s security of supply and empowering citizens in the value chain opportunities available.
“Security of supply is about the country taking ownership of its destiny by first taking over the imported volumes and going to the market and getting long-term contracts. “Oil production over the years globally has not been growing because of climate concerns and there has not been a lot of investment in oil and gas. “Demand over the past five years has outstripped supply and during COVID-19 a lot of refineries, not just in South Africa but all over the world, were not able to recover and South Africa is also now importing. “We cannot rely on them to supply 100% of our fuel requirements.”
He said security of supply was about diversifying the sources and routes of supply as well as developing adequate infrastructure within the country to insulate the economy against supply shocks.
“We promise and commit to continue working with the industry, both citizen firms and the multinational oil companies as well as upcoming oil marketers and other parts of the industry such as transporters,” he said.
