THE existence of many service stations that provide fuel to thousands of Namibians across the country is under threat because the construction of a yet unknown number of these businesses has been declared illegal.
In a letter seen by Informanté, the Minister of Mines and Energy, Tom Alweendo stated that the ministry has noted with concern that many of the service stations have been constructed without proper licensing from the Petroleum Commission. The minister added that in many cases no assessments of the sites, where these illegal service stations were built, were done by officials from the commission.
According to the minister’s letter, in many cases, no valid license for the construction of fuel stations was issued and therefore, no authorization to build them could have been given by local authorities.
The President of the Association of Local Authorities in Namibia (ALAN), Katrina Shimbulu confirmed that all 57 local authorities in Namibia have been alerted to the matter.
“The Minister’s concern has been my concern and the illegal construction of service stations really needs to be stopped,” said Shimbulu.
Approached for comment Petroleum Commissioner, Maggy Shino said the implications are that councillors of local authorities gave the approval for service stations to be built without the proper consent or licensing from the Ministry of Mines and Energy.
“Such service stations will be deemed illegal and owners will be ordered to demolish these business ventures,” she said.
Shino foresaw that this will result in severe losses of revenue, jobs, and investments.
“Illegally built service stations are a problem in the country because we are dealing with the sale of controlled products that can only be sold at approved sites at a regulated price,” she said.
Shino noted that more and more sites are being built because of a scramble to create enough supply for the increasing demand for fuel from consumers. The uncontrolled increase of fuel stations also resulted in older business ventures becoming unprofitable.
“The situation also resulted in operators incurring high operational costs and therefore demanding higher dealer margins which effectively results in high fuel prices that filters down to the consumers paying high prices for fuel in the country,” Shino concluded.