Mangoma defiant over ethanol project

ENERGY Minister Elton Mangoma has insisted that the Chisumbanje ethanol project was not granted national project status adding the company's land deal with agricultural parastatal ARDA has also also nullified the coalition cabinet. Mangoma was recently roughed-up by company employees and local villagers
during a trip to the plant by a ministerial committee set up to help resolve problems that have stalled the US$600 million project.

 The company, a joint venture between two private firms and ARDA, has since stopped production at the Chisumbanje plant, with officials blaming Mangoma for allegedly blocking a bid to have the government introduce mandatory blending of ethanol and petrol. But Mangoma accused the project developers of playing to the gallery and failing to address the “real issues” which include a humanitarian crisis created by the displacement of villagers when some 3,500 hectares’ of land was taken up by the company.

 He claimed the company has also failed to reassure the general public that their product would not cause any damage to vehicles. “Which cabinet gave them that (national project) status? It is not correct; there are no cabinet meetings to that effect,” Mangoma said. “All these approvals which the people are talking about are just in people’s minds. National project status is given by the ministry of finance and there is nothing like that at the moment.” Mangoma said the 25-year build operate and transfer (BOT) agreement between Green Fuel, which is developing the project, and Arda was nullified by Cabinet after fact-finding mission revealed apart from getting access to 5,112 hectares’ of ARDA land, the company went on to acquire a further 3500 hectares’ of communal land. He said the project would now be a joint venture with the government. Mangoma claimed his ministry has repeatedly met with Green Fuel and advised them to address the pricing for their product as well as its compatibility with vehicles.

He said the company’s ethanol was too expensive compared to world market prices which hover around US0,70c and US0,76c per litre. “Their pricing of US$1is too high,” he said. “It will be unfair to put a premium that is that big on something that you are forcing people to do. This product is currently on the market and people do not want it.” Green Fuel, Mangoma added has failed to meet several requirements set out be the government before mandatory blending can be introduced. “Even those countries that have gone through that route did certain things,” he said. “We have given them a list of things that need to be done and the first thing we told them, was for them to assure the motoring public that the new fuel will not harm their vehicles. “We also asked them to submit the logistical arrangements on how the company would deal with the issue of the catalytic converters on some vehicles. Up to now there is nothing.” Touted as a panacea to the country’s US$73,1 million annual fuel import bill, the ethanol project now teeters on the brink of collapse amid allegations of deliberate sabotage by sections of the country’s divided coalition government.

 Production at Chisumbanje stopped early this year after the company exhausted storage capacity having stockpiled 10 million litres of product. The impasse over mandatory blending could see some 4,500 workers lose their jobs.