N$3,7 Billion Fuel Tender Stinks Again

FUNDING for the planned national petroleum storage facility has hit controversy after a top official at the National Energy Fund (NEF) claimed she was in the dark about the funding of the project, which has ballooned from the initial cost of N$920 million to N$3,7 billion.

Red flags have been raised about the tender after it emerged that the contract was allegedly pushed through and modified to benefit some government officials.

NEF was prepared to fund the N$920 million project through a fuel

levy but the project cost suddenly ballooned to N$3,7 billion, an amount NEF and government do not have.

NEF deputy director Anna Libana declined to comment on whether they can raise the billions needed for the project.

“I don’t know. You are asking me a difficult question. I just came back from leave today. I cannot comment on that question because I have not been updated about the issue of funding,” she told The Namibian yesterday.

NEF is supposed to be funding the project but the lack of clear communication about funds has put the project under scrutiny.

The tender for the construction of the national oil (petroleum) storage, petroleum off-loading (petroleum jetty) facilities and pipelines was awarded to a joint venture led by China Harbour Construction Engineering and Namibian businessman Veino Nghipondoka with his firm Babyface Civils.

The Chinese company also received the contract to transform Namibia’s port for N$3 billion. There were 31companies that initially submitted bids but only two lasted till the end.

“There is a situation where a contract has been signed with project consultants while funding for the fuel storage project has not been secured. The N$3,7 billion is way too expensive,” said a source who refused to be named but also accused the National Planning Commission of hijacking the tender.

“It should have been run by the ministry of mines and energy or Namcor but it is run from the NPC. There’s g suspicion that some individuals wanted to push through the project to benefit. The manner in which this whole tender was run stinks,” said the source. The Namibian understands that Omkumo Consulting have been appointed as consultants of the multi-billion dollar project and are set to rake in millions of dollars from NEF for their work.

“Now the NEF is expected to pay the consultants, who recently signed an agreement with the ministry. So the question is what then if they get paid from the NEF and the funding is not secured? The fuel storage depot was declared a government project with a special steering committee under Tom Alweendo and several other ministers. Permanent secretary of the National Planning Commission Leevi Hungamo, who was among the officials who awarded the Chinese company the contract, said even though the tender was estimated at N$920 million, the approved tender will bring more benefits compared to the initial plans.

He denied suggestions that the cost had ballooned and said the source of funding should not be a concern as NEF will get the money through fuel levy collection.

The PS said the N$920 million was just speculation not the final figure, adding that the N$3,7 billion will cover a petroleum storage facility, petroleum jetty and pipelines.

Asked about top officials, who pushed the deal through because they allegedly had a hand in the cookie jar, Hungamo said the country observes the rule of law and those with evidence of wrongdoing can report it to the police.

Even though he denied a shady deal in awarding the tender, the administrator said the procurement processes they used can be audited. According to him, they are currently sorting out official procedures and will make an announcement on the way forward soon.

This will not be the first time the multi-billion dollar tender has raised questions. The media reported last year that several companies had been removed from the shortlist, amid allegations of bribe offers.

Source : The Namibian