24 May 2012

Zimbabwe: Zera Gives Fuel Operators Ultimatum

The Zimbabwe Energy Regulatory Authority (ZERA) has warned petroleum industry operators to register with the agency before the end of this month, as it emerged that the regulator had fortified its operations with the appointment of a substantive chief executive officer.

Information obtained by The Financial Gazette's Companies & Markets indicate that government last month appointed Gloria Magombo (pictured above) as the ZERA chief executive officer, ending a protracted battle between a government official, Peter Mufunda, and Energy and Power Development's permanent secretary, Justin Mupamhanga, over his appointment and permanent transfer to the top ZERA job.

Mafunda had worked as an administrator for ZERA since its transformation from what was called the Zimbabwe Electricity Regulatory Commission (ZERC) and had sought a High Court order for a permanent transfer to ZERA which he alleged was being blocked by Mupaamhanga.

Magombo, an executive commissioner in ZERA's predecessor, ZERC, was responsible for consumer services, technical and economic regulation. She holds a Masters Degree in Mechanical Engineering and an MBA and is a member of the Zimbabwe Institute of Engineers and World Energy Council technical committee on performance of power plants.

In a notice to petroleum industry players issued this month, and soon after her appointment, the new ZERA boss said all operators in the sector were required to operate under licence issued by the agency as provided for under the Energy Regulatory Act and the Petroleum Act.

The licences are issued annually at prescribed fees which vary according to the nature of operations.

Fuel producers and importers pay the highest fees at US$20 000 per operator, followed by fuel wholesalers at US$8 000, blenders at US$5 000.

Retailers are charged US$500 and US$200 for urban and rural operations respectively.

"ZERA has noted that a large number of fuel companies are operating without licences in violation to the provisions of the Petroleum Act (Chapter 13: 22) section 29 titled Licensing Requirements...," the agency said in the notice.

It said all fuel companies operating without licenses after May 31, 2012 would "leave ZERA with no option but to invoke the provisions of the Act".

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