Botswana government says it has found it important to secure the supply of petroleum products as seen by the creation of the state owned oil company. Botswana Oil Limited (BOL), the new kid on a raft of government owned entities, will be used to safeguard the security of supply of petroleum products in the country.
When launching the new company, owned 100 % by taxpayers, President Ian Khama said petroleum products in the modern world play a critical role in turning the wheels of industrial development and in turn improving the economic well-being of nations.
“Without a continual and secure supply of petroleum products, our economy could be compromised. As a landlocked nation we need to ensure a flawless flow of petroleum products into the country,” he said.
“To this end, Government saw it fit that rather than relying solely on Multinational oil companies, we partake in the supply of these very critical products to assure security of supply. However, we need to recognize the good work that these companies have played and still continue to play through the supply and distribution of petroleum products.”
He said government is conscious of the fact that companies, including Multinationals are in their very nature there to ensure that they make a reasonable return on their investment for their shareholders.
He added that it is against this background that their investment decisions are commercially focused and as such they may decide to invest or divest as they see fit based on commercial reasons or interests. “For example, in 2010 BP divested its operations in Botswana. Shell also sold a significant portion of their investment.”
“In light of the foregoing, Government took a firm decision to establish Botswana Oil Limited, so as to safeguard the security of supply of petroleum products. It is therefore important to note that the entity will look at ways and means of bringing in petroleum products to ensure that we have a reliable and sustainable petroleum industry in Botswana.”
The mandate of the company include amongst others to manage state-owned strategic fuel reserve facilities, strategic stocks as well as bulk storage and distribution and facilitate meaningful citizen participation in the petroleum sector.
The company headed by Willie Mokgatlhe, a former Shell Botswana Country Chairman, is incorporated under the Companies Act of Botswana operating under the purview of the Ministry of Minerals, Energy and Water Resources.
Botswana Oil Limited is being setup alongside Okavango Diamond Company whose mandate is to independently market and sell diamonds on behalf of government followed by the Mineral Development Company Botswana Limited whose mandate is to manage and maximize Botswana’s business interests in the Mining Sector. Following suite is the signing of the Trans Kalahari Rail Project Management Office on the 4th September 2014 by the Governments of Botswana and Namibia to establish TKR Project Management Office before the end of this financial year to facilitate the implementation of the Trans Kalahari Rail and associated port facilities in Botswana and Namibia.