18 December 2012

Zimbabwe: Govt Misses Ethanol Deadline

Government has failed to introduce mandatory blending of petrol within two months in line with a Cabinet resolution banning unleaded petrol in Zimbabwe. In September, Government resolved that mandatory blending should be introduced in two months as a way of reviving the Green Fuel ethanol project in Chisumbanje.

Green Fuel - which owns the Chisumbanje ethanol plant - is a joint venture between Arda, Macdom Investments and Rating.

It was also agreed that the ownership structure of Green Fuel be changed from a Build Operate and Transfer arrangement to a joint venture between Government through Arda and its investment partners.

After changing the ownership structure of the company, Government said it would immediately introduce mandatory blending starting with E5 with a view to gradually adopting mandatory blending to E10 up E20 by 2015.

In his recommendations to Cabinet, Deputy Prime Minister Arthur Mutambara, who is leading a Cabinet committee on the revival of the Chisumbanje ethanol project, said the conversion of the project from a BOT to a JV must proceed speedily.

He said mandatory blending should only be considered within the context of a JV because Government could not have mandatory blending for one private producer of ethanol.

DPM Mutambara on Monday refused to shed light on the implementation of the Cabinet resolution.

"We will call you, we will call you," said DPM Mutambara before switching off his mobile phone.

Although DPM Mutambara refused to shed light on the matter, Herald Business is reliably informed that he recently visited the ethanol plant in the company of Energy and Power Development Minister Elton Mangoma.

It is understood that he met members of a shadowy group based at Checheche Growth Point known as Platform for Youth Development.

In his recommendations to Cabinet, DPM Mutambara noted that legal instruments and other supportive measures must be put in place.

He said mandatory E5 fuel specification would increase the uptake of ethanol fourfold to 2,3 million from the current 0,6 million litres and result in 3 percent lower carbon emissions.

DPM Mutambara said E5 was the ideal starting point because none of the car manufacturers and sellers has a problem with that level of ethanol, whereas there were complaints about some vehicles' compatibility with E10.

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