swaziland times

Mbabane – If all goes according to King Mswati III’s wishes, the contract for the construction of the Strategic Petroleum Reserve facility will be signed next week.

He delivered this message yesterday while visiting the Swaziland National Petroleum Corporation (ENPC) stand at the 2024 Swaziland International Trade Expo at the Mavuso Trade Exhibition Centre. When the King arrived at the ENPC booth, he was warmly welcomed by Kenya’s Minister of Natural Resources and Energy, Prince Longkonghela. The Prince then introduced ENPC CEO Nhlanhla Dlamini, who briefed the King on how the state-owned enterprise plans to implement the project to build a strategic petroleum reserve.
The King smiled as Dlamini explained the number of litres the facility would hold.

Sufficient funds
The CEO then explained that negotiations were already underway to ensure sufficient funding for the project. He assured that the negotiations would be concluded soon so that the project could be launched. Specifically, the CEO said they are waiting for the Ministry of Finance and the Republic of China (Taiwan) to finalize an agreement regarding the project.
The King then asked when exactly the contract could be completed. The King jokingly said that he knew Ambassador Leung Chun-ying was present and had ordered him to be summoned to confirm that the contract negotiations were about to be completed, which made everyone present laugh.

The Ambassador, who was standing a few meters away from His Majesty, walked to the front and stood next to the CEO. “Come and tell us the good news I heard. The good news is that the contract for the construction of the strategic petroleum reserve will be finalized next week,” said the king. The ambassador then smiled and the king went on to say that all those involved in the project should discuss the issue and give him feedback next week.

Pending Capital Projects
It is noteworthy that in his throne speech in February this year, the King stressed the need to prioritize a number of pending capital projects, one of which is the strategic petroleum reserve. The king made it clear that he wanted the project to start within six months. In terms of background, Taiwan agreed to help Swaziland, its only African ally, build a new oil depot in the country last September, according to a memorandum of understanding signed by both sides. The Overseas Investment and Development Corporation (OIDC), a Taiwanese company focused on executing government overseas aid projects, was contracted to build the strategic oil facility.
It is reported that the Kingdom of Swaziland had hoped to build an oil tank that could store at least 30 days of oil reserves.

Milestones in bilateral relations
Former President Tsai Ing-wen, who is on a four-day visit to Swaziland, hailed the agreement as a milestone in relations between the two countries. The former president said the two countries had been negotiating the construction project for some time, adding that the planned facility would help ensure the country’s energy supply security. According to the country’s government website, since Swaziland imports most of its petroleum products from South Africa, it is vulnerable to fluctuations in international crude oil prices. As a result, the government authorized its national oil company, ENPC, to build and operate oil storage facilities as part of efforts to address the problem and better ensure energy security. The MoU was signed by OIDC General Manager Jeff Chung and ENPC Chief Executive Officer Nhlanhla Dlamini.

King Mswati III and President Tsai jointly witnessed the signing of the Memorandum of Understanding. OIDC was established in 1995 by several state-owned and private companies in Taiwan to undertake aid and infrastructure projects initiated by the ROC government in its allies. It is not clear whether the company has undertaken the fuel storage facility. It is said that the oil reserve facility will ensure fuel supply security and make a significant contribution to the country’s socio-economic development through infrastructure construction and job creation.

Construction and operation
ENPC said on its website that it is the country’s national oil company established under the Petroleum Law No. 18 of 2020 and is authorized by the government to build and operate the Strategic Petroleum Reserve facility in Phuzumoya. The company said the facility will ensure fuel supply security and make a significant contribution to the country’s socio-economic development through infrastructure development and job creation. In November 2023, ENPC invited companies to prequalify contractors for the proposed construction of the strategic fuel reserve facility in Phuzomya. This is known as Tender No. 10 for 2023/2024. According to the project background conveyed by ENPC, the public entity plans to build a strategic petroleum reserve facility in Phuzumoya, which is essential for the country to achieve energy supply security and mitigate fuel supply disruptions.

Petroleum products
Currently, Swaziland purchases petroleum products from the international market through the Republic of South Africa and Mozambique. Most of the product is distributed from commercial storage facilities in Matsaffa. The company said that although the Petroleum Act 2020 requires oil companies to hold 14 days of commercial inventory, inventory is usually limited to approximately two to three days of storage. Therefore, the Swaziland government intends to develop a strategic petroleum storage facility through ENPC.
The facility will house up to 80 million litres of fuel stock, equivalent to 60 days of the country’s consumption. It will also provide mixing capabilities for all 95-ULPs.

In March this year, Swaziland’s Prime Minister Russell Mmiso Dlamini visited Taiwan to seek investment in the African kingdom and discuss details of the fuel storage facility, which was a clear demonstration of Swaziland’s determination to get the project off the ground. During the visit, the Prime Minister reported that he had an appointment with President Tsai Ing-wen and later visited CECI Engineering Consultants, a leading engineering company in Taiwan. In addition, the Prime Minister also said that the ambassadors of the two countries presented the progress report and design plan of the project in Phuzomoy.

Securing fuel supply
The Prime Minister stressed that the facility will help the country secure fuel supplies and prevent disruptions in fuel supply to the market from affecting the economy. He said that currently, Swaziland has no fuel stocks and the country has very limited bulk fuel storage infrastructure. “If there is any disruption in the supply chain within or outside our borders, our economy will become vulnerable. Therefore, this facility is a pressing need for us. During our inspection, we encouraged CECI to set up a factory in Swaziland as this reputable company already employs about 2,300 people in Taiwan and other countries. “They have a presence in the construction industry and are well known for building railways, bridges, hospitals and more,” the prime minister said.

Meanwhile, the King’s visit to the various stands at the trade fair yesterday went smoothly. As in previous years, the King will inspect each stand, be greeted by staff and then receive feedback on the entity’s operations. For most exhibitors, he would ask different questions, mostly involving feedback on certain projects.