Rwanda sells state-owned oil company to Shell

Aug 05, 1999 02:00 AM

The Rwandan government stroke a deal with Shell Oil Company on selling of Rwanda's government-run oil company, Petrorwanda, to the company. According to the deal, Shell Oil Company acquired 19 out of 32 retail service stations previously owned by Petrorwanda, Donald Kaberuka, Rwandan Minister for Finance and Economic Planning indicated.
In addition, the government agreed to lease the Gatsata Depots, 15 km north-east of the capital Kigali, for a period of 30 years, the Rwanda News Agency reported. "Government shares in Petrorwanda have been divested at $ 2.1 mm., whereas the annual lease for Gatsata depots was valued at $ 51, 000," Kaberuka said.
Paul Maes, Shell Managing Director, based in Kampala declared that his company will inject $ 5 mm in the rehabilitation of the Petrorwanda network. "The sale of the company's assets stems from the heavy losses that have always been incurred," explained Kaberuka. "Petrorwanda owes the government an outstanding debt of over $ 3,9 mm as indicated by December 1998 audit," he disclosed.
He said that Petrorwanda started with specific objectives but later became a financial liability due to corrupt management and inefficiency. Kaberuka commended Shell Oil Company for its track record world-wide, saying "Rwandans hope Shell will bring high level of services, quality, and competition."

The divestiture of government's shares in Petrorwanda coincided with the spectacular rise of fuel pump prices which had seriously disrupted transport of people and goods between the capital and upcountry.

Source: Xinhua via Newspage
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