The government has chosen Kuwaiti commodities trader Independent Petroleum Group (IPG) to run state-owned oil assets Petrotrade and Genesis Energy.
This follows the suspension of Petrotrade board chair Tinomudaishe Chinyoka together with the entire board who were opposed to the deal. Soda suspended the board in March this year.
IPG will partner with the two parastatals, which supply fuel to the government and other agencies.
The development was announced on Tuesday by Information Minister Monica Mutsvangwa while addressing journalists at the post-cabinet briefing in Harare. She said:
Cabinet considered an update on the partial privatisation of Petrotrade as presented by the Minister of Energy and Power Development, Honourable Zhemu Soda.
The nation will recall that Cabinet in 2019 approved the merging of the state-owned petroleum companies, namely Petrotrade (Pvt) Ltd and Genesis Energy to form a single entity that would be partially privatized.
Cabinet also approved Independent Petroleum Group (IPG) as the prospective strategic partner to the merged petroleum company, subject to successful negotiations.
The Transaction Advisor proposed three merging methods or options, that is, 1 Purchase of assets, 2 Business purchase and 3 Establishment of a New Company.
Cabinet wishes to inform the public that it approved the business purchase merging method since it fulfils the Government’s objective of merging Petrotrade and Genesis Energy at the least restructuring cost.
The option will preserve the value created to date by both entities over the years and will ensure minimum disruption to the current operations.
Chinyoka was suspended together with Zanele Dube, Simbarashe Mhuriro, Gladys Mumhure, Ferida Matambo, Lilian Timveos, Getrude Marabada, Godfrey Ncube and Dakarai Mukuku.
He has since approached the High Court seeking to overturn Zhemu’s decision.
Chinyoka, who is a lawyer, claimed he was suspended because he challenged corrupt activities responsible for the loss of millions of dollars at the fuel company.