SUNBIZ

Government Prepares To Import Petrol, Gas

Government is preparing the process to import fuel such as petroleum and gas into the country by itself. This has been part of the 2015 National Budget announcement made on
23 Nov 2014 11:24
Government Prepares To Import Petrol, Gas
Minister for Finance Aiyaz Sayed-Khaiyum being escorted into the Parliament on Friday before he delivered the 2015 National Budget address. Photo: RAMA

Government is preparing the process to import fuel such as petroleum and gas into the country by itself.

This has been part of the 2015 National Budget announcement made on Friday by the Minister for Finance, Aiyaz Sayed-Khaiyum.

He said this new initiative will ensure stability in fuel pricing in Fiji and will ultimately lower the cost of doing business and cost of living.

Government is expected to call for international tenders for supply of fuel. $250,000 has been allocated from the 2015 Budget for this purpose to finalise this.

“This will enable us to negotiate lower fuel prices and pass savings to consumers when local oil companies procure fuel from Government,” he said.

Mr Sayed-Khaiyum said the model they announced is based on the Mauritian one.

“Even companies like Total, which operate in Fiji, are in Mauritius,” he said.

The process

Mr Sayed-Khaiyum clarified that Government will essentially become the purchasing agency for fuel.

“So it does not have to own infrastructure and own oil tankers etc. It simply calls for international tenders,” he said.

Mr Sayed-Khaiyum said Government will ask the three fuel companies as to how many litres of fuel they need and then they will call for international tenders.

He said so if all the fuel companies want 50 million litres of fuel making it 150 million litres altogether, Government will be able to negotiate better pricing because of this large volume.

“In Mauritius the fuel price has not increased for two years because they have a stabilisation fund,” he said.

“Obviously fuel pricing a lot of times fluctuates. So when its low, Government takes some money and sets aside as stabilisation fund and when it goes up, they subsidise that.”

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