Who will fill the new WB fuel storage facility?

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Edgar Brandt

Windhoek-The massive fuel storage facility in Walvis Bay, which is anticipated to cost government N$5.2 billion upon its envisaged completion in June 2018, will require 75 million litres of fuel to be filled to capacity as part of the testing requirements agreed upon with the contractor.

Government, or alternatively the facilities operator, will be required to procure the fuel to fill up the new facility. However, the likely operator, the National Petroleum Corporation of Namibia (NAMCOR), says the bill to fill up the facility will most likely fall on government for the strategic stock and to NAMCOR for the commercial stock. In this regard, consultations between the two entities are ongoing.

“We believe the strategic stock will be government’s responsibility, while NAMCOR will be responsible for commercial stock. However, should government delegate the responsibility to acquire strategic stock to NAMCOR we will then have explore viable options,” NAMCOR spokesperson Utaara Hoveka said.

The facility in Walvis Bay will be able to store 5 million litres of diesel 500 (old diesel); 40 million litres of diesel 50 (new diesel); 20 million litres of unleaded petrol; five million litres of heavy fuel oil and five million litres of aviation fuel.

“This is of significant strategic importance and constitutes the critical, underlying strategic reason for the implementation of the project,” said the permanent secretary in the Ministry of Mines and Energy, Simeon Negumbo,
However, he could not yet specify what it will cost to fill up the storage facility upon completion, noting that this will depend on the demand for fuel and the monthly demand required and decided upon in terms of the operational philosophy, operation manuals and the operation and commercial models adopted by government.

“The final cost of the procurement of the fuel will be dependent on the prevailing price of fuel and negotiations with any potential supplier of such fuel,” Negumbo said.

During a recent interview with New Era, Negumbo noted that the country’s current fuel import facilities have far exceeded their design life and pose a fire hazard to the entire Port of Walvis Bay.

Accordingly, the old facility will be decommissioned by June 2020 and the new facility used for all fuel imports into the country. As such, the operators, which will likely be NamPort for the offshore activities and Namcor for onshore items, will be guaranteed income through the ordinary port and throughput and storage fees.

“It is similarly also worth noting that the governments of our neighbouring countries, through their state-owned oil companies, have expressed a firm interest in making use of the new facilities to service their own domestic demand.

“The new facility is a critical first step to fulfilling the objective of Namibia becoming a regional logistics hub in accordance with Vision 2030, NDP5 and the Harambee Prosperity Plan,” Negumbo added.

Once completed, the facility will increase the country’s security of fuel supply from the current 7-10 days to 30-45 days. According to government the project is on track, with no delays expected before commissioning.
And it is a sizeable lot, with seven oil tanks and one water tank all sitting on 20,000m3, 10,000m3, 5,000m3 and 7,000m3, variedly; each beam is 2 metres long with 11 bars.

“This is the part of the project where we do not allow locals. The tank farm is an issue of national security and requires a high-level set of skill and experience to manage. Even our teams are highly trained and vetted before working here. It is a new phenomenon for Namibia, so it is understandable when we cannot find such skills.

“In fact, much of the work on these projects are new, the small reason we have sent those two young students to study such skill in Namibia,” Xu Yuqing, deputy project manager for the Chinese company CHECH, that won the construction tender, said in a previous interview.

The Port of Walvis Bay’s new container terminal on reclaimed land project is being implemented by Namport.
The North Port programme, of which Phase 1 is the new liquid bulk terminal currently under construction, is being implemented by the Ministry of Mines and Energy.

1 COMMENT

  1. Here we go again.The Chinese national sets out the rule as to how this facility should be managed upon commissioning of the storage facility. I’m just wondering how did we manage to manage and operate the existing facilities with the existing skill set. Please wake up and smell the coffee.

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