Marketing and Distribution
Distribution and marketing of fuels products and lubricants is carried out by the state-owned oil company, Petromoc which controls the majority of the market share. Other companies with a share in the market include; BP which also operates the only lube blending plant in the country, Mobil and Caltex which is mainly involved in bunkering activities. BP has increased its market share to bring itself to a similar level as Petromoc in terms of market control. Both BP and Petromoc service the aviation sector with BP holding the dominant share in the jet fuel market. Petromoc dominates the kerosene market.
The three ports of Mozambique – Maputo in the south, Beira in the centre, and Nacala in the north – offer an economic supply corridor to neighbouring landlocked countries. Presently, only Zimbabwe is transporting most of its petroleum products through Mozambique. Swaziland, receives approximately 5% of its product through the Maputo port and Malawi receives 18% through Nacala. Engen imports small volumes through Maputo to Swaziland using Petromoc’s depots at Matola (Maputo). Maputo and Beira are important for domestic imports.
The pipeline between Beira and Harare has been extended and is operating close to full capacity even with an expansion through the addition of pumping stations. Revenue earned from the use of the pipeline is significant.
A new oil product jetty accommodating vessels of 50,000 tons has been completed at the port of Beira. The existing jetty is being rehabilitated. The other port that can accommodate large vessels is Nacala; however, due to low consumption in the area and poor transport connections to the rest of the country, the importance of Nacala in the distribution of petroleum products is diminishing.
The current downstream oil market in Mozambique is relatively small. However, Mozambique’s consumption of liquid fuel products has increased and the World Bank has forecast that Mozambique’s consumption should grow by 2.2% per annum between 1993 and 2005. The increase has mainly been in the area of gasoline, jet fuel, and gasoil while the consumption of fuel oil has declined and kerosene has remained stable.
The main consuming areas of petroleum products are the southern and central parts of the country with a smaller percentage in the north. Consumption is heavily skewed towards gasoil, which represents the majority of the region’s demand. LPG and fuel oil are currently consumed almost exclusively in the Maputo area.
The pricing formula, with the exception of LPG, overestimates the actual cost of importing products. The tax of petroleum products is about 17%. Annual petroleum tax revenue is approximately $11 million per annum and represents some 17% of government indirect taxes. In an attempt to attract investment from foreign companies, the Mozambican government has made changes to the tax system. A privatisation programme is also taking place.
Mozambique has adequate storage facilities for refined petroleum products situated all over the country. There are twenty-eight depot facilities with nominal capacities of between 30 to 600 CuMt. Twenty depots are owned by Petromoc, while the balance is owned by BP (7) and Mobil (1). There are also two marine depots at Quelimane and Pemba each with a capacity of 6000 to 7000 CuMt. Depot rationalisation is underway.
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