Seven foreign firms, including Kuwait’s Independent Petroleum Group (IPG) have submitted bids to supply 1.4 million tonnes of petroleum feedstock to Zambia over two years, the procurement authority said on Friday.
The preferred cargo mixes for Zambia’s Indeni Refinery and TAZAMA Pipeline operations and the Zambian market is a blend of standard export grade crude, naphtha or condensate and straight run gas oil, the tender document said.
The southern African country is the continent’s top producer of copper and uses a lot of diesel in the mining operations that are the backbone of its economy.
IPG, whose deal for the supply of oil to Zambia expired last month, is competing with Lukoil International Trading and Supply Company (LITASCO) of Russia, Glencore Energy UK Ltd, Vitol SA, Trafigura SA, Addax Energy SA and Kenya’s Gulf Energy Ltd.
“They are now given 21 days starting on Monday in which they should submit their evaluation and recommendations for award of contract,” Shadreck Shawa, the head of purchasing at the Zambia Public Procurement Authority (ZPPA) said.
“We should be able to select the preferred bidder within a month because even if there are issues that will arise, these should be negotiated within two weeks,” Shawa said.
The issues to be agreed with the winner would include the timeframe for the supply of the first cargo through the port of Dar-es-Saalam in Tanzania, the ZPPA said.
The 1,440,000 tonnes buyer’s option will be brought in cargo lots of 60,000 to 90,000 tonnes at evenly spread intervals, according to tender specifications.
Shawa said BNP Paribas has given bid security amounting to $2 million each for IPG, LITASCO, Glencore, Vitol and Addax. Trafigura has a $2 million cover by ING Bank of Holland and Gulf Energy the same amount by PTA Bank.
[Reuters South Africa – Chris Mfula]
what about our zambian oil in north western province…?
I thought there was something going on with the russians. Weren’t they the preferred ones ?
We should be thinking of a refinery that can process Angolan oil. I guess that would be cheaper in the long term. If located in western province ,it would enhance economic activity there.
#3 yours sounds like such a logical approach but I guess there is more to it than meets the eye. The Multi national corporations already have a large stake in the oil coming out of Angola so it is possible that they have bought the oil concessions in Angola for many years to come if not until when the oil wells run dry!!! Chevron Corp, Total and Exxon Mobil alone account for 2/3 of the oil coming out of Angola right now and you will note that none of them have bid to supply oil to Zambia
what about zambian bidders, does it mean we cant supply our oil? we can let kenyans supply but zambians cant.
its very sad i see ..LT thanks that you put this artical about oil ..NOW i see bloggers are not interested in economic issues….only 5 comments so far ..this shows that people of zambia are not ready to discuss about economy and other important things..its all about sata and hichilema..very sad.we have oil and no one is even commenting on that..
Life is not fear here in Australia we Zambians are being charged two times the school fees and VISA fees compared to the local people here while back home in Zambia foreigners are charge Zero fee, why should we be treated so unfairly like this, this system is no different from slavery we are supposed to be charged the same fees because we are humans as well we have the same red blood flowing same senses same body parts but i don’t know why we black people have to work hard for other to get rich out of our sweat, and now the only land that GOD had given us is being given to the same white people who are treating us very badly ,most of the time i wish GOD had come this minute. Kuands purpose of freedom is being weekend we need another Kunda to raise the Eagle out of its jail into the free…
:-?the issues around the oil procurement saga continues to be one enshrined in mystery. The US$2,000,000 guarantee that is required for a tender of this magnitude is not in the reach of too many Zambians. perhaps our banks need to come out of the closets to allow for the locals to participate.