SINGAPORE (Reuters) – Tanzania has bought more than 600,000 tonnes of oil products for delivery over May and June from Swiss trader Augusta Energy, traders said on Monday.
The purchase is estimated to have cost Tanzania about $750 million, one of them said.
State-run oil company the Petroleum Importation Coordinator bought 416,000 tonnes of gasoil with 500 parts per million (ppm) sulphur, 200,000 tonnes of 93-octane gasoline and 30,000 tonnes of jet A-1 fuel, traders said.
It paid premiums of about $54 a tonne over Middle East quotes for the gasoil cargoes, about $35-40 a tonne for the gasoline and about $50-55 a tonne for the jet fuel, another trader said.
Tanzania has been buying large volumes of gasoil and gasoline in the spot market since January, when its government introduced a bulk procurement system to lower fuel costs.
Both of the previous tenders for delivery over January to April were also awarded to Augusta Energy, traders said.
Tanzania’s economic growth could beat its 6.0 percent forecast for fiscal 11/12, with inflation falling to single digits by the end of the year in June, despite power shortages and a sluggish global economy, the country’s central bank said.
East Africa’s second-biggest economy has attracted major investment over the past decade but the disruption from last year’s drought in the region slowed electricity production.
Power output in the country of 42 million people fell 22 percent in the third quarter of last year, partly due to low water levels in its key hydroelectric reservoirs, forcing it to seek fuel from the international market.