HARARE – Trafigura, the Singapore domiciled commodities giant that is under the spotlight in Zimbabwe over State capture allegations, is to fortify its interests in the southern African country through power exports from a plant earmarked for Beira, Mozambique, according to the firm’s 2019 annual report.
In the past two weeks, Trafigura has faced relentless allegations from a faction of ruling ZANU PF members unhappy with its growing influence, who say it is using its muscle to manipulate all facets of the State, including the army.
But in a commentary, chief executive officer, Jeremy Weir appeared unperturbed by the war of words in Harare, telling shareholders a 120-megawatt (MW) power plant would be established on the Mozambican coast, with neighbouring Zimbabwe among targeted export destination.
The southern African country is battling rolling blackouts of up to 22 hours a day due to depleted output from the Kariba hydroelectric power plant, and its thermal power stations across the country.
The Kariba power plant has a 1 050MW installed capacity.
But it has been affected by droughts that saw water levels declining to 19 percent at the end of last year.
“In Mozambique, we are working with Afrochine to develop a 120MW plant at the port of Beira that will help address power shortages in Zimbabwe,” Weir said in the annual report.
“We expect growth to accelerate as regional power trading in the region takes off, for example in the Southern African and West African power pools. In Ghana, for example, we have invested in an efficient new combined-cycle 107-megawatt power plant designed to run on natural gas. In both Benin and Togo, we have partnered with power generation companies to provide LPG for power. Both projects are expected to come online in the course of 2020,” he added.
Trafigura is a leading supplier of fuels to African power generating utilities, and is working with national authorities on many of the more important projects that may require debt or equity finance as well as long-term fuel supplies.
The report said Trafigura has been working around the clock to help Zimbabwe address grinding fuel shortages.
“Trafigura prides itself on placing security of supply to its customers at the heart of its operations, even in the most financially challenged markets,” Weir noted.
“Zimbabwe is a case in point. Trafigura has a significant share of the market to supply fuel to the land-locked country, working with our partner company Puma Energy, which has its own retail network. Together we have kept the pumps in operation throughout Zimbabwe’s eventful recent history and recurrent balance of payments problems. Key to this feat is our investment in a complex logistical chain stretching from storage tanks in-country back through a 500 kilometre pipeline across Mozambique to the Indian Ocean port of Beira, where Trafigura uses Puma Energy’s first-class storage assets – one of the few facilities in the city to have been unaffected by Tropical Cyclone Idai in March 2019,” said Weir.
“But an additional important feature is Trafigura’s willingness to go the extra mile to honour its supply contracts, and to work with customers including the government to offer them tailor-made solutions, such as longer payment terms, additional supplies via alternative routes or special arrangements to create buffer stocks against expected supply shortages. Whatever happens, the customer comes first,” said the Trafigura boss.