By: Kandjengo kaMkwaanyoka
Almost every country in Southern Africa reportedly has 2 or 3 months of fuel supply left, with strategic conversations happening behind the scenes on how and where to secure added supplies.
Namibia and Botswana are not spared from these fuel supply panics, given what is happening in the Middle East, which is one of the biggest sources of crude and refined petroleum products.
To this effect, the two countries have been contemplating building another oil storage facility.
Having been offered a stake in Angola’s Lobito Refinery along with Zambia, it stands as an oddity that Namibia’s Cabinet has not uttered a word on the offer. Now, Angola plans to turn to China and borrow billions for the completion of the refinery to secure a steady fuel supply for its people.
As for Namibia and Botswana, they are still contemplating how they will effectively manage their fuel supply.
With no clear end in sight or predictability of how events will play out in the Middle East, now is a valid time for Namibia to reflect on the refinery questions. More interestingly, two major final investment decisions on crude oil production are expected this year, which could make Namibia a crude oil producer.
Southern Africa is in need of fuel, production, and logistical costs are rising due to decisions undertaken by our leaders and the apparent inability to use global events to make tough decisions. That said, the Namibian government, Cabinet, and its economic planners have no reason not to contemplate a refinery investment.
None of the countries in Southern Africa have fuel reserves sufficient enough to release to the market in efforts to stabilise prices or supply each other for an extended period.
Global events are shaping economic decisions around the world, but Africa is not acting. At this juncture, Namibia and Botswana have enough reason to change their minds on building storage facilities and pooling resources for a refinery instead.
With the Namibian ocean having global oil companies sniffing around for oil, along with the current crisis in the Middle East, there is enough incentive for the Namibian Cabinet to convene on the potential of an oil refinery.
This may be NAMCOR’s time to shine by leading the fuel supply conversation, preparing the numbers, and getting out of its management scandal to lead the charge effectively.
On the matter of vulnerabilities such as management scandals, some fundamentals of the nation call for urgent addressing to enable industrialisation, such as electricity insecurity, industrial water supply issues, and now fuel.
How will an investor or local entrepreneur scale up and be competitive with the high cost of energy and volatile supply? The country has to fix the energy fundamentals to de-risk the country from global issues, heightened geopolitics, and coercion.
Oil still has more years as a critical production input, notably in transport and industrial use. Despite Africa’s sluggishness in adapting or innovating, oil will remain a crucial tool in continental development.
Thus, the silence from economic facilitators in government on fuel supply is shocking as the private sector waits for the way out, interventions, and a plan to counter the disruption, especially considering the available medium to long-term solutions on the table.
Can the refinery discussion be revisited, with some realistic simulations and forecasting, with NAMCOR leading?
Options must be weighed, but continued dependence should never be an option. Namibian economic realities are becoming harder, and they require tough, selfish, strategic decisions.
