Energy Fund’s N$50m to help plug fuel gap

MINISTER of Mines and Energy Erkki Nghimtina says Government is under pressure to compensate oil companies for petrol imports during 2005, having sold it for much less than the cost of bringing it to Namibia.

The National Energy Fund will receive N$50 million from the 2006-07 National Budget to help plug the gap. Nghimtina told the National Assembly this week that Government could not allow itself to be caught in the same position this year and would continue to monitor and adjust prices in line with the cost of importing petroleum products.Nghimtina said he was aware that concern had been growing in Namibia about the stability of supply, given that South African refineries last year struggled to match demand.He said the import of fuel from countries other than South Africa was already being considered to avoid any future shortages from spilling over into Namibia.In the long term, he said Government planned to secure supply by enforcing mandatory stockholding levels.Also faced with an electricity crisis, Nghimtina said Government was hard-pressed to support the development of another power station.But he said substantial financial input was needed to expand, upgrade and develop power-generation sources.Over the next three years, Government will contribute N$750 million to the development of a gas-fired power station at Oranjemund – Kudu Gas.Nghimtina said his Ministry was also committed to ensuring an interconnection between Zambia and Zimbabwe to increase Namibia’s chances of engaging actively in regional electricity trading.Nghimtina told the National Assembly this week that Government could not allow itself to be caught in the same position this year and would continue to monitor and adjust prices in line with the cost of importing petroleum products.Nghimtina said he was aware that concern had been growing in Namibia about the stability of supply, given that South African refineries last year struggled to match demand.He said the import of fuel from countries other than South Africa was already being considered to avoid any future shortages from spilling over into Namibia.In the long term, he said Government planned to secure supply by enforcing mandatory stockholding levels.Also faced with an electricity crisis, Nghimtina said Government was hard-pressed to support the development of another power station.But he said substantial financial input was needed to expand, upgrade and develop power-generation sources.Over the next three years, Government will contribute N$750 million to the development of a gas-fired power station at Oranjemund – Kudu Gas.Nghimtina said his Ministry was also committed to ensuring an interconnection between Zambia and Zimbabwe to increase Namibia’s chances of engaging actively in regional electricity trading.