ZAMBIA: 1,000 oil tankers go missing in fuel controversy

JOHANNESBURG, 5 June 2003 (IRIN) - One thousand oil tankers with US $13.5 million worth of fuel destined for Zambia's oil refinery from neighbouring countries never reached their destination between 1999 and 2000, said an auditor general's report tabled in parliament earlier this week. The report also noted that an examination of the supplier's records showed that more than double the amount of oil approved by the Zambia National Tender Board was sold to procurer the Zambian National Oil Company (ZNOC). There was also a discrepancy in official records between the amount of oil loaded by the supplier and the amount actually received in Zambia, news reports said. ZNOC, the national oil purchaser, was put into receivership in 2001 with vast debts. Zambia's oil procurement procedures have become part of a wider anti-corruption probe by President Levy Mwanawasa. Donald Chanda, former president Frederick Chiluba's economic advisor, who is currently being questioned by parliament's public accounts committee on the contents of the report, was previous board chairman of ZNOC, the Indeni oil refinery and transporter Tanzania Zambia Mafuta. The auditor general linked Chanda to the irregular supply of oil. In April this year, Zambia faced serious fuel shortages as a result of procurement problems. The crisis was attributed to Mwanawasa's decision to cancel a fuel supply contract with Trans Sahara Trading (TST), a subsidiary of the Canadian mining firm, Diamondworks. Mwanawasa cited unnamed irregularities when he ended the deal with TST as the sole supplier of fuel to Zambia in March. The then vice-president, Enoch Kavindele, awarded the supply contract to TST in August last year, cutting out TotalFinaElf, the main company supplying crude in the region. Kavindele's son, Junior, has reportedly been linked to TST, but Kavindele denied any personal connection to the firm. The controversy led to Kavindele's sacking last week for ignoring Mwanawasa's decree terminating TST's supply contract. He also allegedly failed to follow accounting procedures when he received a US $100,000 donation from TST for the ruling Movement for Multiparty Democracy.