17/02/2025
JOB WELL DONE MR PRESIDENT:Tazama Pipelines Introduces Competitive Bidding for Open Access: A Game Changer for Zambia’s Fuel Sector
NB: Energy PS, Energy Ministry procurement Head and TAZAMA pipeline Head should be on the watch list 24/7 as they seem to be working with enemies of the President daily sabotaging Mr President's good intentions. We shall call this group working against the President as a THIEVING ENERGY CARTEL.
Tazama Pipelines introduced competitive bidding for the Open Access of Oil Marketing Companies to the pipeline for the transportation of diesel from Dar es Salaam to Zambia.
This significant step is set to bring multiple benefits, including reduced diesel prices and improved efficiency in the transportation process, which will have a direct positive impact on Zambia’s economy.
The Tazama pipeline, which plays a crucial role in transporting refined fuel products from Dar es Salaam to Zambia, has already shown substantial benefits since its inception.
By alleviating the pressure on Zambian roads, it has significantly reduced congestion and wear-and-tear on the country's road networks.
More importantly, it has led to a reduction in the time it takes to transport diesel into Zambia, contributing to a more reliable and timely supply of fuel.
A Strategic Move for Zambia's Future
The introduction of competitive bidding for the Tazama pipeline is part of the government’s broader efforts to enhance Zambia's energy sector, promote economic growth, and improve access to affordable and reliable energy sources.
By reducing the cost of transporting diesel and ensuring a steady supply, this new initiative aligns with the nation's commitment to enhancing economic stability and growth.
The results of the tender that closed on 4th February 2025, already shows that wholesale diesel prices could reduce by as much as 10%, with a proportionate reduction in retail pump prices.
The significance of diesel in industry and commerce cannot be overemphasized as it is a key input in the mining, manufacturing, transport and energy sectors of the economy.
As such, reduction in diesel prices have far reaching consequences on cost structures and the competitiveness of firms operating in the aforementioned sectors.
The Benefits of Competitive Bidding for Open Access
With the introduction of competitive bidding, Tazama Pipelines is opening up its infrastructure to multiple suppliers. This new open-access model aims to foster increased competition, leading to a variety of benefits:
Reduced Diesel Prices: Increased competition among Oil Marketing Companies is expected to result in a significant decrease in the price of diesel, benefiting consumers, businesses, and the economy at large.
A lower cost of diesel will also contribute to the reduction of fuel costs for transportation across Zambia, indirectly benefiting many diesel dependant sectors such as mining, logistics, agriculture, and manufacturing.
Improved Efficiency and Reliability: By allowing multiple players to compete for access to the pipeline, Tazama Pipelines aims to streamline fuel delivery operations, reduce bottlenecks, and ensure more consistent and reliable delivery timelines.
This enhanced efficiency will make the diesel supply chain more robust and responsive to the needs of the Zambian market.
Long-Term Economic Growth: Lower diesel prices, combined with improved transportation infrastructure, will create a more favourable environment for economic development in Zambia.
Businesses will have access to more affordable energy, which will encourage investment, promote trade, and create jobs in key sectors like retail, transportation, and agriculture.
Increased Investment in Infrastructure: The competitive bidding process will also help attract new investments in Zambia’s fuel infrastructure. More private-sector players are likely to be drawn to the open access pipeline model, ensuring better maintenance, upgrades, and the continued expansion of Zambia's fuel transport capacity.
As the country faces one of the worst energy crises in post-independence history, occasioned principally by a debilitating drought in the 2023/2024 season, most of commerce and industry has had to supplement their energy needs with diesel powered generators
With the open access consumers shall benefit from lower costs of fuel for their daily movements providing the much-needed relief and freeing up resources for other areas of discretionary spend.
For the ordinary Zambian, lower pump prices mean lower costs of essential commodities that are part of day to day living as transport costs which are linked to pump prices are always a factor in the final selling prices.
For traders at all levels, lower prices entail lower cost of doing business, better margins and enhanced competitiveness.
For operators in the transport business, lower diesel prices allow for enhanced profitability while allowing for commuter fares to reduce and provide respite to ordinary Zambians.
