A directive issued by the National Bank of Ethiopia (NBE) requesting foreign oil companies engaged in oil and gas exploration and development projects in Ethiopia to open a foreign currency bank account in Ethiopia has frustrated international oil companies.
The directive compels the oil companies to have a foreign currency bank account with Ethiopian commercial banks which will be supervised by the NBE. The companies can withdraw cash in local currency for their expenditure for the oil and gas projects.
“All purchase of goods and services will be transacted in line with foreign exchange directive of the National Bank of Ethiopia through the banking system,” NBE said.
Previously, the oil companies used to have offshore accounts and a local currency bank account in Ethiopia. The companies transfer foreign currency to their local accounts that they use to finance their oil and gas exploration projects in Ethiopia. The new directive now requires the oil companies to open and maintain foreign currency accounts in Ethiopia.
The companies had the right to open and freely maintain foreign bank accounts outside of Ethiopia. However, the new directive stipulates that the companies should open and maintain a foreign currency account in Ethiopia.
All the international oil companies engaged in oil and gas exploration and development projects have furiously protested NBE’s directive. The companies have lodged their complaints to the Ministry of Mines and Petroleum. “Even after a series of communications with the Ministry and the NBE the problem could not be resolved,” representatives of the oil firms told The Reporter.
The Ministry of Mines and Petroleum disclosed that the British energy firm New Age (African Global Energy Ltd) has discovered 1.6 Trillion Cubic Feet of natural gas reserve in the Ogaden basin, Somali Regional State.
State Minister of the Ministry of Mines and Petroleum Guang Tutlam (MD), told The Reporterthat New AGE has discovered 1.6 Trillion Cubic Feet of Natural gas in a locality called Elkuran. “We are now working on the gas commercialization. We are looking at ways how to market the gas,” Guang said.
Three international oil trading firms bidding to supply fuel to the Ethiopian Petroleum Supply Enterprise (EPSE) in the 2019 fiscal year. Last September EPSE has floated a tender inviting international oil trading companies for the supply of fuel to be delivered as of January 2019. The enterprise wants to procure 1.35 million metric tons of gasoil, 240,000 metric tons of jet fuel and 350,000 metric tons of gasoline. The enterprise requested international oil trading firms to submit their technical and financial offers by October30, 2018. The bid opening was scheduled for October31, 2018. However, based on the request made by the bidders it was postponed to November8.
Tadesse Hailemariam CEO of EPSE told The Reporter that 36 oil companies bought the bid document. However, he said only three companies- TRAFIGURA PTE LTD, Vitol Oil and Petro China-have submitted their technical and financial proposals to the enterprise. Tadesse said that the bid committee was evaluating the technical proposals adding that the financial proposal will be opened next week. “If all the three companies pass the technical evaluation the financial proposal would be opened next week and the least bidder will be the winner,” he said.
A rebel group in eastern Ethiopia’s gas-rich Somali region began landmark peace talks with Prime Minister Abiy Ahmed’s government. The talks may lead to a referendum on self-determination after a three-decade insurgency by the Ogaden National Liberation Front in an area where gas extraction could generate $7 billion of state revenue a year. They’re the latest step toward a political thaw in the Horn of Africa country in the wake of sweeping political reforms initiated under Abiy since he came to power in April.