GOVERNMENT and a South African investor are inching closer to sealing a US$1 billion pipeline deal that is set to make Zimbabwe a regional petroleum hub.
BY NDAMU SANDU
The investor, Mining Oil and Gas Services (Mogs), a subsidiary of the cash-rich Royal Bafokeng Holdings, has been shuttling between Harare and Johannesburg to finalise the transaction and close sources said the signing was imminent.
Negotiations for the project started in the life of the inclusive government but were abandoned in the run up to the July 31 elections as political parties engaged in campaigns.
The plan will also entail building connecting pipelines to Malawi, Zambia, Botswana and the Democratic Republic of Congo (DRC). Estimates showed that the project would result in the creation of over 100 000 jobs.
Sources last week said that government wants the deal to be signed soon as it wants to use the project to attract investors.
In addition, Zanu PF is under pressure to deliver on its electoral promises.
During its campaign period, Zanu PF promised “heaven on earth” and is now confronted with a crisis of expectations.
“This project will be seen as a Zim Asset [Zimbabwe Agenda for Sustainable Socio-Economic Transformation] baby. Government wants to tell all and sundry that the economic blueprint will turn around the fortunes of the economy,” a government source said.
The current pipeline can pump 150 million litres a month. However, it is carrying 120 million litres a month.
With industry at its peak, the country would require 200 million litres per month.
The new pipeline is expected to move 500 million litres per month.
It is understood that despite the Msasa storage facility having a capacity of 500 million litres, only a tenth was in store, meaning that the infrastructure was underutilised.
Mogs will have a 50% shareholding in the project while government and an empowerment consortium will have the remainder.