National Oil Company of Malawi (Nocma) plans to construct a rail siding at its Blantyre and Lilongwe strategic fuel reserves at a combined value of K2.2 billion ($3.1 million).
The move, according to Nocma communications officer Telephorus Chigwenembe, will ensure security of fuel supply and cutting transport cost of the commodity that comes through the Nacala corridor in Mozambique.
A siding, in terms of rail terminology, is a low-speed track section separate from a running line or through routes such as a main line or branch line.
In this case, it means the siding will branch from the railway line managed by Central East African Railways (Cear) to fuel reserves at Matindi in Blantyre and Kanengo in Lilongwe.
Chigwenembe, in response to an e-mailed questionnaire on Saturday, said the project is in line with Nocma’s mandate of ensuring security and stability of fuel supply.
He said the project will be financed through the storage fund collected by Malawi Energy Regulatory Authority (Mera) and is expected to be completed by April next year.
Said Chigwenembe: “We are in the process of procuring a consultant to design engineering works.”
Minister of Finance, Economic Planning and Development Goodall Gondwe, in a recent Letter of Intent to the International Monetary Fund (IMF), also hinted that government is taking necessary steps to improve fuel security situation in the country.