National Oil Company of Malawi (Nocma) Sunday defended the United Arab Emirates (UAE) deal and another deal involving GET Global, stressing that nothing sinister is going on in both deals.
This comes at a time Malawians have raised questions about the deals.
Speaking at a press conference, Nocma Chief Executive Officer Clement Kanyama also defended the coming in of Minister of Transport Jacob Hara in matters relating to fuel, saying the minister came in following on-going infrastructure construction activities that require considerable quantities of petroleum products.
He told journalists that the Ministry of Transport and Public Works identified fuel from a UAE-based refinery through an arrangement with GET Global.
However, Kanyama said the Ministry of Transport did not have a licence to import fuel and that, therefore, it was processing an importers’ licence at the Malawi Energy Regulatory Authority (Mera) in order to go into an agreement with Nocma to import the fuel.
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“The ministry is in the process of getting the licence as this will enable it to seek a hospitality agreement with Nocma, where Nocma shall be an agent and MOTPW [Ministry of Transport and Public Works] shall be the principal,” Kanyama said.
He added that Nocma would only go into an agreement with the ministry after it is awarded a licence to import fuel.
“Since MOTPW is yet to be issued a licence by Mera and a hospitality agreement is yet to be signed, verification work with entities who are storing the product has not been carried out by
Nocma. This includes obtaining confirmation on the bank accounts, which will receive payments for onwards processing to the supplier/ refinery.
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“As [for] next steps, Nocma [‘s] verification of the product shall be based on the following; MOTPW having been issued with an importers license, hospitality agreement, signed between Nocma and MOTPW. Given that MOTPW is part of government, Nocma shall obtain
a Treasury prior approval on use of bank of accounts under this hospitality agreement. Nocma can confirm that no financial transactions have taken place between Nocma and MOTPW under the proposed hospitality agreement,” Kanyama said.
However, this is contrary to what we have seen in the documents between the ministry and Nocma, and between the minister and the supplier— as they already commenced transactions on fuel in the absence of the agreement and the license.
A letter Referenced GGL-MOTPW-CNF01-040924 from Green Energy Tech (G.E.T) Global to the Minister of Transport and Public Works Jacob Hara, dated Wednesday, September 4 2024, with a reference to Hara’s letter—which included details such as ‘REF: MASTER FUEL SUPPLY AGREEMENT NO. FSA-SPA-GGL-23-MTPW-001 and has ‘CONFIDENTIAL’ as the subject matter—confirms discussions around the transactions.
“We have finished the reallocation process of the product to release to MOTPW. The available volumes as discussed are; 20,000mt [metric tonnes] EN590 EX-Tank Beira, Mozambique, 20,000mt RON95 EX-Tank Beira, Mozambique.
“We have sourced the first emergency consignment from our partners Trafigura, Mozambique, in Beira to meet the urgent request, to who [sic] are well known to your appointed agent Nocma. The fuel verification for the emergency consignment will be made through Trafigura. Product is currently in tank in Beira, Mozambique – at PetroBeira and Lakeoil Storage Facilities,” the G.E.T Global letter, signed by its director Roy Miller, reads.
It adds that on satisfactory confirmation of the product by the Minister of Transport’s agent, namely Nocma, they shall proceed to issue the product invoice and formally introduce their management company (Inter Africa Fuel) for the next process of product release of the contract consignments as per their contract.
But, then, Kanyama emphasised that “NO financial transactions have taken place on this arrangement, as hospitality agreement is not yet assigned.”
This, to the part of Nocma, may be true but the Minister of Transport Hara—who has no importer’s licence—in a letter to Nocma dated August 27 2024 and referenced No: MPTW/C/TP/400/8/27/11’, is seen directing Nocma to do the following when they receive the fuel: “Collect sales and remit all payments to OptiCoin Malawi, Standard Bank, City Centre Branch, Kwacha Account no: 9100006975205.”
And despite Kanyama saying Nocma is not in any hospitality agreement with the Ministry of Transport, letters exchanged between minister Hara and Nocma Board Chairperson Colleen Zamba suggests otherwise.
In the letter, dated August 27 2024, Hara is seen making directives to Nocma and, in a letter dated August 28 2024, Zamba seems to be agreeing to Hara’s directives.
Hara, on the other hand, is seen pushing the supplier to quickly deliver the first emergency tonnes.
In a letter addressed to the minister, referenced GGL-MOTPW-TUP-060924, and dated Friday September 6 2024, with subject ‘REF: UPDATE ON PRODUCT DOCUMENTATION AND VERIFICATION”, G.E.T is apologising to the minister for the delay in submission of proof of product documentation and subsequent verification of the product.
“This is because our partner, Trafigura, raised concerns of Malawi’s capacity to pay for the product, to which they feel will have a ripple effect on G.E.T Global’s capacity to perform on the same. To this effect, Trafigura has demanded the full payment of the product before they release the product documentation and allow [the] Ministry of Transport and Public Works (Malawi) to verify and collect product.”
“We are pleased to inform you that our bankers have today, the 6th of September, processed the payment in full for the 1st consignment. Kindly take note that product documentation is expected to be released by Wednesday upon receipt of funds. Ministry of Transport and Public Works (Malawi) will then be free to carry out verification and collection of product immediately after receiving the documents. We do hope that this is acceptable on your part,” Miller signs.
This is in full contrast to what Kanyama said, as he stated that no contract in both GET and the Sheikh one had been sealed.
On her part, Mera spokesperson Fitina Khonje said on Friday that the ministry only sought guidance on how a licence was applied for but had not yet applied for one.
“The Ministry of Transport made an inquiry on the process to be followed if an institution would apply for an import licence. Mera provided the guidance. Mera has not received any details pertaining to the said procurement from GET Global; neither from the ministry or Nocma. And there is no application for a licence from the Ministry of Transport,” Khonje said.
On its part, the Public Procurement and Disposal of Assets Authority (PPDA) also denied having knowledge of the deal.
Its spokesperson Kate Kujaliwa directing us back to Hara.
“Thank you for your inquiry regarding the procurement of fuel from GET by the Ministry of Transport and Public Works. As per the information provided, the letter in question, addressed to the Nocma Board, was not communicated to the Public Procurement and Disposal of Assets Authority (PPDA). Therefore, the Authority is unable to comment on this matter as it is outside its purview.
“For further clarification, the authority recommends directing your queries to the Ministry of Transport regarding how the supplier was identified,” Kujaliwa said.
On the Sheikh deal, in which Nocma wanted to import 250,000mt of fuel, Kanyama said all due processes were followed and that they did not flout any procedure.
The deal, said to be in Kwacha, has, according to Kanyama, since been blocked by the PPDA as it refused to grant a No-Objection.
He however said the Nocma Board was working on implementing recommendations from PPDA.
Asked how the single-sourcing by Sheikh was identified, considering that the volumes required are outside the threshold of single sourcing, the Nocma CEO could not explain.
Asked if the President was aware of the two deals, Kanyama asked us to direct the question to officials in the President’s office.
“I’m hopeful [that] they will respond. I can’t say here as I don’t work in the office of the President,” he said.
Meanwhile, Leader of the Opposition in Parliament George Chaponda has demanded the immediate resignation of Hara and Zamba for allegedly being involved in the questionable transactions.
“I urge all Malawians to rise up and demand accountability from their leaders.
We cannot afford to remain passive while our nation’s resources are plundered.
It is imperative that citizens take a stand for transparent governance.
“Where are our civil society organisations? Many were rightly critical of the previous DPP [Democratic Progressive Party] administration [and yet], now, [they] remain conspicuously silent as our country teeters on the brink of disaster. We need your voices, your advocacy and your steadfast commitment to ensuring that those in power are held accountable,” Chaponda is quoted saying in a statement.
At the moment, the Human Rights Defenders Coalition, through chairperson Gift Trapence, has described the goings-on as abuse of procurement procedures.
Trapence said this showed the extent of “chaos and deep rottenness” in the public sector when it comes to procurement.
“It seems that no one is in control. This contract should be cancelled and investigated. HRDC is, therefore, calling upon the Ombudsman office to investigate the matter to see if there was interference in the procurement process.
“Malawians are sick and tired of hearing the very same stories of abuse of office and maladministration, hence our call to the Ombudsman office to investigate the allegations,” Trapence said.
