Friday, November 14, 2014

Muhongo: Why Bunge won’t see gas contracts

Energy and Minerals minister Sospeter Muhongo

Energy and Minerals minister Sospeter Muhongo addresses the media in Dar es Salaam yesterday.  PHOTO | VENANCE NESTORY 

By Ludger Kasumuni,The Citizen Reporter

Dar es Salaam. Energy and Minerals minister Sospeter Muhongo yesterday heightened the rift between the executive and the legislative arms of government by reiterating that his ministry will not submit the oil and natural gas production sharing agreements (PSAs) for scrutiny by the Public Accounts Committee.

The remarks by Prof Muhongo means that Parliament will now have to find its own ways of getting the ‘secret documents’ for scrutiny.

On November 2, this year, a parliamentary Public Accounts Committee (PAC) ordered the arrest of two top executives of Tanzania Petroleum Development Corporation (TPDC) for their failure to present to the committee the 26 PSAs that the government has entered into with multinational companies.

Police arrested acting Director General James Andilile and Board Chairman Michael Mwanda following an order from the PAC chairman Zitto Kabwe. The two were shortly after released as the police said they needed a legal clarification from the Attorney General’s office before making any further move towards prosecuting them.

The Dar es Salaam Special Police Zone Commander Suleiman Kova said the police released them pending some clarification from Parliament. He said it was agreed that as per Section 12 (3), PAC chairman was supposed to report the issue to the Speaker of the National Assembly first. PAC was thus forced to write to the office of the Speaker of Parliament on the possibility of taking legal action against TPDC executives.

And, in an interesting turn of events, Prof Muhongo said yesterday that there was no way his ministry would submit the PSAs to PAC, saying the contracts have been withheld due to technical reasons.

“We have to adhere to government regulations. We cannot subject the contracts to public discussions, because they are regulations in place governing them. Even contracts between individuals, like yourself and somebody  else must be governed by certain rules,” said the minister.

“Go and ask any lawyer. Go and ask any professor of Law and they will tell you the modality of implementing contracts. The PSAs are not the contracts between TPDC and investors, but they are the contracts between the government and prospective investors. And I am speaking on behalf of the government,” he insisted.

He however, did not clarify on those regulations governing PSAs which have been under hot debates in recent years.

Prof Muhongo’s new stance goes contrary to what he once said. He is on record as having been quoted saying that the PSAs are not confidential and that everyone looking for them should either visit TPDC’s website or go and ask for them at the ministry. Even the former TPDC Managing Director, Mr Yona Kilagane, and Mr Mwanda himself have been repeatedly quoted as saying that contracts are open for public scrutiny.

In yesterday’s event, Prof Muhongo was responding to questions from journalists after he officially launched the second Powering Africa Tanzania conference.

In his speech to the conference delegates, he said the government had welcomed more investors to develop energy sector so that its target of enabling 75 per cent of Tanzanians access electricity in 2025 is achieved.

“Every country in this world is attracting investors from local and foreign sources for spearheading development. Don’t take into your mind the views of people who are against investors. We have to increase private sector participation in improving the energy sector,” he said. According to him, the current level of investment in the energy sector which stands at  $4 billion (Sh6.4 trillion) needs more spectrum of investments to attain the target of increasing access to electricity by Tanzanians from the current 36 per cent to 75 per cent in 2025 when the country will attain middle income status.

At the conference attended by 170 investors from America, Europe and Asia, the Vice President of Millennium Challenge Corporation(MCC)  Mr Kamran Khan said that during the second phase of MCC in Tanzania, priority would be in energy infrastructure, investments and corresponding capacity building projects.

Mr Khan said that the satisfactory performance of MCC phase I projects value at $609 million (Sh974.4 billion) had prompted their corporation to continue to spur investments  in the country.

For his part, the chief power engineer of African Development Bank (AfDB) Mr Babu Ram said that since the AfDB had been supporting energy infrastructure projects for six African countries earmarked by the U.S President Barrack Obama’s powering Africa program, Tanzania stands to benefit as well.

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