THE cash-strapped National Petroleum Corporation of Namibia (Namcor) has told its suppliers that it is relying on the minister of mines and energy Tom Alweendo’s support for a government bailout to settle its debt.
It will be the second publicly known cabinet bailout for the company after the government handed a package to Namcor including paying off debts of nearly N$260 million in 2010.
Namcor is currently facing major challenges in managing its cash flow due to a troubled 2022. As of September 2023, Namcor’s debt to suppliers stood at N$1,9 billion.
Some suppliers have now given Namcor a deadline of 30 November and are hinting at a process of liquidation should the company not settle its debt.
In a move to save the company, the Namcor board last month gave its guarantees to its suppliers that it is relying on the minister of mines and energy Tom Alweendo’s support for a cabinet bailout to settle its debt.
This was confirmed by letters obtained by The Namibian which were exchanged between Namcor and its suppliers.
Namcor and Alweendo were set for a meeting on 7 November.
One of the suppliers, Augusta Energy which is owed N$176 million by Namcor said it is hoping that the state-owned oil company will obtain support “you need from the Minister of Energy when you meet with him on 7 November. Please advise us of the outcome of that meeting at the earliest opportunity.”
Namcor board chairperson Jennifer Comalie yesterday confirmed to The Namibian that they have engaged the government.
She admits that 2022 was a challenging year as Namcor made net losses of around N$600 million.
“This presents major challenges in managing our cash flow,” Comalie said.
“We, however, confirm that we are managing our cash flow proactively, remain committed to honouring our debt and have engaged the shareholder for support to arrest the situation,” she said.
Comalie said the company has made progress in the last months to address the concerns.
According to her, since the losses incurred in the 2022 financial year, it is not a challenge that can be fixed in the short term.
Namcor acting managing director Shiwana Ndeunyema yesterday said they are aware of the issues at hand and are taking ownership and accountability to resolve them.
He said as of September 2023, Namcor owed N$1,9 billion to its creditors, a decrease of N$600 million from N$2,5 billion in May 2023.
“This commitment is shared by both the management team and the board, who are working diligently to mitigate these challenges in a manner that ensures the continued operational efficiency of Namcor,” he said.
Minister of mines and energy Tom Alweendo referred questions to the Ministry of Finance and Public Enterprises.
The Ministry of Finance and Public Enterprises said it will respond later this week.
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