A Russian company, Rosneft, plans to construct a pipeline for refined petroleum products from the port of Beira in Mozambique to Harare. The pipeline will also serve Zambia, Malawi and Botswana. Reports from Russia say Rosneft was preparing legal documents for the joint venture. The reports indicate that the Russian company has since obtained a permit from the Mozambique government to increase capacity of the existing pipeline in a deal that involves construction of a new one through a joint venture between Russia, Zimbabwe, and Mozambique.
Rosneft official Roman Trotsenko was quoted by Russian media as saying the company expected to get all permits for the pipeline by the end of the year.
He said the need to cover two jurisdictions was complicating the agreements. The cost of the first stage of the project has been put at US$700 million to be funded by a consortium that Rosneft set up.
Zimbabwe imports fuel through the 287km-long Feruka pipeline, which stretches from Beira in Mozambique to the oil refinery at Feruka, just outside Mutare.
The Zimbabwe Government controls 21km of the pipeline, while Mozambique, through its company Companhiado Pipeline Mozambique-Zimbabwe, controls the rest.
The existing oil pipeline has a carrying capacity of 130 million litres per month. But fuel importers have been shunning the pipeline, opting instead for road transport, prompting the Government to introduce a US$0,04 per litre road fuel levy to induce importers to use it.