Chronicle EditorAfrica Moyo Property Reporter
THE National Oil Infrastructure Company (Noic) is planning to construct a service station in Hwange on a 13 020-square-metre piece of land, as it seeks to grow its footprint across the country. Noic is owned by Government, and commenced operations in 2011 after the unbundling of its forerunner, the National Oil Company of Zimbabwe (NocZim).
Petrotrade – which is into fuel retailing – is the other firm that was created from the unbundling of NocZim. Last weekend, the Hwange Local Board confirmed in a notice that Noic intends to erect a service station in the coal mining town of Hwange.
“Notice is hereby given in terms of Section 152 sub-section 2 of the Urban Councils Act Chapter 29:15 that council intends to sell an industrial stand No. 11118, measuring 13 020m2 to Noic for the purpose of constructing a service station. Any objections to the process should be lodged in writing to the town secretary, Hwange Local Board . . . within 21 days,” reads the notice.
Once the deals sails through, the depot may help Noic to blend and distribute fuel in the western parts of the country. Currently, Noic is understood to be using the Bulawayo depot – which was acquired for almost $3,6 million – to blend and distribute fuel in the region. It could not be establish how much the Hwange project would cost.
Noic’s plans to spread its tentacles come at a time when it has indicated its willingness to invest up to $20 million in various projects in the next 18 months. Arguably one of the best performing State Enterprises and Parastatals, Noic declared a dividend of $4 million to its shareholder, Government, for the 12 months ended December 31, 2015.
In 2013, Noic had declared a dividend of $3,6 million. According to Noic chairman Dr Jimias Madzingira, the $4 million dividend was achieved on the back of increased throughput and stringent cost containment adopted by the board in the period under review.
Following the cost cutting measures, Noic recorded a 37 percent rise in profits compared to the previous reporting period. Noic is considering fresh investments into other areas to diversify revenue streams, by extending capacity to ethanol and liquefied petroleum gas handling and storage.
Increased throughput and decline in cost has seen Noic’s revenue grow exponentially in the last two years from $11,4 million in 2014 to $16,1 million in 2015. Total throughput volumes in the year to December 2015 stood at 1,53 billion litres of combined product, representing an increase of 10 percent on prior year.
Thirty-eight out of 93 State owned enterprises audited last year incurred a combined $270 million loss as weak corporate governance practices and ineffective control mechanisms took their toll.
Critically, of the 93 entities, 70 percent of them were ‘technically insolvent,’ or ‘illiquid’, presenting an actual or potential drain upon an already overburdened fiscus. This makes Noic one of the better run parastatals. Noic owns a 50 percent stake in Petrozim Line, a joint venture with Lonmin, formerly LONRHsO.
Petrozim Line owns and operates the Feruka (Mutare) to Harare pipeline. The pipeline is the cheapest and most efficient way of transporting fuel to Zimbabwe and beyond.
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