Regulations do not allow people to buy gasoline in jerry cans, store it and even re-sell it. But many people in rural areas are still engaging in such malpractices due to inadequate filling stations a situation that limits access to such an important commodity. Steve Chauluka, in this FRIDAY SHAKER, explores how small-scale business persons take advantage of fuel scarcity in rural areas to engage in this risky business which not only puts peoples’ lives at risk but also pushes cost of commodities.
Kondwani, in his late 20s, is a motorcycle taxi operator in the Central Region district of Ntchisi.
As a local transporter who helps people from remote Ntchisi areas to access the Boma, he grabs every opportunity that comes his way as long as it brings money and keeps his business running.
Kondwani is sent by illegal fuel traders from surrounding villages in the district to buy and transport fuel such as petrol from the Boma where there are two of the district’s three filling stations.
One of the filling stations is located at Malomo, 23 kilometres from the Boma.
On this day, Kondwani had been sent by the traders from Mwansambo, 50 kilometres from the Boma, to buy them petrol from the filling station.
Kondwani, with the help of one of the fuel attendants at the station, loaded 14 containers of fuel on his motorcycle.
Each of the containers carried 20 litres meaning that he transported 280 litres of petrol from the Boma to Mwansambo.
Kondwani said people are forced to buy and transport fuel that way because most areas in the district are far from filling stations.
“From here, I am going to Mwansambo to deliver this fuel to the traders who sent me. With the introduction of motor bike taxis that are almost everywhere in the district, there is a high demand for fuel. Most of these motorcycle taxis commute in the remote areas where there are no filling stations so these traders are just bringing the fuel closer to the people,” he said.
Kondwani charges K1,000 for every 20-litre container and on this trip alone he pocketed K14,000 for carrying 14 containers.
As of October 9 2019, the recommended petrol price was K868.00 per litre but Kondwani told us that the traders in the remote areas resell the fuel at K1,000 or more per litre.
“In this case, buyers have no choice; no one can come here to buy fuel. The only convenient way is to buy fuel from traders in rural growth centres and markets in the villages. These traders store their petrol in their shops. They do not have reservoirs and they keep the fuel just like any other commodity,” Kondwani said.
Energy and Natural Resources Committee of Parliament Chairperson, Werani Chilenga, said regulations limit storage and transportation of fuel in the country, but he admitted that it was difficult to enforce such regulations.
He said even in his Chitipa South constituency, which is 120 kilometres away from the Boma, there are no filling stations, a big challenge for the people with motor vehicles and motor ycles.
“People that transport fuel are supposed to be licensed but the challenge is how people who have vehicles in these areas can operate without fuel? The alternative is to encourage as many Malawians as possible to operate filling stations in rural communities. That is also the main reason the government established National Oil Company of Malawi [Nocma] so that it supplies fuel to those operating in rural areas,” Chilenga said.
He also urged Malawi Energy Regulatory Authority (Mera) to license small scale fuel operators who can open small filling stations in rural areas and reach out to many people.
Nocma publicist, Telephorous Chigwenembe, said their role was not to ensure availability of fuel in rural areas but that the country has enough fuel by importing and keeping it in strategic reserves.
“All we do it is to ensure that we meet the fuel demands of each region per month. It is the oil marketing companies that are responsible for the supply of fuel to the areas they operate in,” Chigwenembe said.
On the other hand, he also said that the company is concerned about the safety of people that handle fuel and they conduct awareness campaigns on the same.
Storing fuel in homes puts lives at risk of fire accidents which are common in Africa.
Regulation 99 discusses storage of Liquid Fuels and Gas in the liquid fuels and gas production.
Supply Act of 2004 which it says “no person shall store any brand of liquid fuels of a quantity of more than 20 litres within any building, which, or part of which, is used as living accommodation or as a place of habitual public resort.”
Sub-regulation 99 (2) also states that “a person who wishes to store liquid fuels or gas for commercial purposes shall first register with the authority.”
There is, however, limited enforcement of these regulations in Ntchisi as motorcycle transporters such as Kondwani clearly flout them.
“The police know that the fuel supply situation in this district is poor. We have been accusing them of arresting us for these offences because this situation is not our fault,” Kondwani said.
Ntchisi police publicist, Richard Kaponda, said they enforce the laws by arresting anyone transporting fuel without licences.
“We know that this is an offence and we arrest them. Sometimes, these transporters use uncharted routes to avoid the police and it is difficult to arrest them. However, we still arrest them for breaching the law,” Kaponda said.
Mera Public Relations Officer, Patrick Maulidi, said service station operators know that they are not supposed to sell fuel in jerry canes unless in special circumstances where the buyer has brought a procurement permit.
“There are special instances where we provide a bulk procurement permit for those operating speed boats on the lake, maize mills, diesel generators among others and they use special containers. As a regulator, we at times make spot-checks in service stations together with the police and when we find these cases, we make arrests and confiscate the fuel,” Maulidi said.
He admitted that constructing filling stations costs a lot of money which business persons based in rural areas cannot afford.
Maulidi said Mera has set special standards for rural service stations.
“We encourage people to construct rural filling stations of lower standards as compared to those in urban areas. There are also incentives for people that construct a service centre in a rural area about 20 kilometres from an urban setting. We know that there are issues of low sales so we give such operators a compensation for operating in rural areas,” he said.
Meanwhile, there are new regulations for service stations to be located a kilometre away from each other in order for filling stations to go towards rural areas, according to Maulidi.
However, there has been an influx of filling stations that are too close to each other in the cities.
Examples of such filling stations are in Limbe and Nyambande.
Maulidi, however, said Mera cannot use the law retrospectively to close the filling stations.
“New regulations were approved and gazetted in 2017; those filling stations were constructed before the new regulations were put into force. Only the new service stations that would be constructed now would be required to be one kilometre away from the existing service station,” he said.
Natural Resources, Energy and Mining Ministry Principal Secretary, Patrick Matanda, while agreeing with Maulidi on the provision of incentives for rural filling station operators, lamented that as profit oriented people, filling station owners shun rural areas.
“The responsibility of regulating the energy sector lies with Mera. They regulate where filing stations should be operating from and now that you have raised the issue, I will get back to them to see what they are doing, otherwise carrying or storing fuel like that is illegal and dangerous,” he said.
Last week, Mera disclosed that it had shut down 32 filling stations for non-compliance with rules and regulations.
Mera Chief Executive Officer, Collins Magalasi, said this during a sensitisation workshop with gasoline marketing companies and retailers on liquid fuels and gas licensing conditions and operating compliance requirements.
He said Mera identified some oil companies that do not meet the set standards.
Meanwhile, some people in rural areas continue to engage in the risky business of buying and selling fuel.