23 February 2018

Zimbabwe: Zim Revives Fuel Pipeline Deal With Bots

Photo: The Source
Feruka fuel pipeline.

Zimbabwe has revived plans to extend its Feruka fuel pipeline to Francistown in Botswana, businessdigest can reveal.

Plans to stretch to Francistown the Feruka fuel pipeline, which links Zimbabwe and Mozambique, were shelved as relations between Harare and Gaborone deteriorated during the twilight years of former President Robert Mugabe's 37-year rule.

Botswana's President Ian Khama was an outspoken critic of Mugabe's repressive rule.

Mugabe, who resigned last year after a military coup, was succeeded by his former deputy Emmerson Mngangawa.

This comes after Mnangagwa's visit to Botswana last week.

Sources close to the deal said the planned extension of Feruka fuel pipeline to Zimbabwe's south-western neighbour were discussed as the two countries seek to mend relations.

Energy and Power Development minister Simon Khaya Moyo told businessdigest this week that plans to extend the Feruka pipeline from Beira through Zimbabwe would open an avenue to Botswana for Harare to supply fuel to the region.

In 2017, then energy minister Samuel Undenge said the pipeline would be extended to Zambia and the Democratic Republic of Congo (DRC) in future.

"We discussed this (plan to extend the pipeline) with the Botswana government during President Mnangagwa's state visit there," Moyo said.

"We want to supply Botswana, Zambia and the Limpopo province (South Africa).We are still at the planning stages."

Botswana, which imports the bulk of its fuel through rail and road, has indicated that importing via the pipeline would significantly lower import costs.

Last year, Zimbabwe reduced fuel shipments through the pipeline from 8,05 cents to 6,5 cents per litre to encourage utilisation of the facility.

Zimbabwe, which imported 1,3 billion litres of fuel in 2016, down from 1,53 litres in 2015 imports 90% of the liquid energy through the Feruka pipeline, which links the southern African country with eastern neighbour Mozambique through a port in Beira.

Zimbabwe also intends to extend the fuel pumping capacity of the pipeline to 7,5 million litres once demand soars beyond the current four million litres every day.

Moyo would not disclose the cost of the project, but said the pipeline will cover a distance of 771 kilometres.

Last year Zimbabwe shelved plans to build another petroleum pipeline running from a port in Beira to the Msasa fuel depot in Harare at a staggering cost of US$1 billion.

The proposed pipeline would have a fuel carrying capacity of 500 million litres per month. Zimbabwe, which is considering banning the costly importation of fuel by road, imports an estimated 1,5 billion litres of fuel at a cost of US$1,3 billion annually.

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