Local oil firms scramble for market in Sudan

Sep 26, 2005 02:00 AM

As peace returns to southern Sudan after 21 years of fighting, many oil companies are fighting for the biggest share in the virgin oil market. Petrocity Enterprises, a Ugandan registered company, has emerged the biggest oil concern in southern Sudan.
"We ship around half a mm litres of diesel and 100,000 litres of petrol per month," says managing director Harish Asodia.

Petrocity Enterprises New Sudan, is a subsidiary of Petrocity Enterprises Uganda, whose mother company is Messrs Coast Haulers based in Mombasa. It started operations in Sudan in May 2005 and has eight filling stations in the region.
"We are in the process of building seven more stations. We will be covering the whole of southern Sudan including Juba," Asodia said at their head office in Kyengera, Kampala.

In Uganda, Petrocity has over 50 outlets and controls 5 % of the oil market share, contributing Sh 15,338,277,532 to the national coffers. It is ranked the 20th biggest taxpayer and the seventh biggest oil company inUganda. It started its operations in Uganda in 2003.
In southern Sudan, Petrocity has units in Nimule, Frasikiska, Yambio, Yei and Rumbek where it also runs a jet fuel terminal. Since the taxes in southern Sudan are lower than in Uganda, the fuel is relatively cheaper. The retail price is Sh 1,700 and Sh 1,900 per litre of diesel and petrol respectively. The Ugandan shilling is the main currency used in Yei.

The biggest oil consumers are road construction companies, NGOs and the UN. The sales manager of Yei Petrocity station said their sales were going down because of smuggled cheap fuel from DR Congo.
"From May up to June, we used to sell between 10,000 to 15,000 litres of diesel per day. "We now only sell 5,000 litres per day," he said without giving the price of smuggled diesel. Smuggled petrol costs Sh 250,000 per drum of 200 litres while the same quantity of fuel costs Sh 320,000 at Petrocity stations.

The Yei station employs 10 people 5 of whom are Ugandans. Apart from the oil business, the company has diversified into hospitality business. It is constructing a 30-bed motel in Yei. Work has already commenced on the motel.
The company's engineer, Moses Mwanje said, "This is going to be the head office of the company in southern Sudan. It will have restaurants and Internet café. The project will be completed by November 2006."

Source: New Vision
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