No influence peddling in Jinja fuel reserves
Mar 12, 2008
WE refer to the article published in Sunday Vision, March 9, titled: “Oil deal haltedâ€. This article created the impression that Kenlloyd Logistics irregularly won a tender to supply fuel as a result of the influence and connections of Sam Kutesa, the Minister of Foreign Affairs, who is the fat
By John Masanda
WE refer to the article published in Sunday Vision, March 9, titled: “Oil deal haltedâ€. This article created the impression that Kenlloyd Logistics irregularly won a tender to supply fuel as a result of the influence and connections of Sam Kutesa, the Minister of Foreign Affairs, who is the father in law of Albert Muganga, one of the directors of Kenlloyd Logistics, and that public funds were at risk. We would like to clarify on the following issues:
Kenlloyd Logistics is a limited liability company incorporated in Uganda among others in the business of importation, buying and selling of fuel and fuel products.
The company has been in this business for a considerable period of time, it is law abiding and has duly been paying taxes to Uganda Revenue Authority (URA). As stated in the article, last year Kenlloyd paid taxes of up to sh1.5b. In the previous year, it paid sh1b in taxes.
Kenlloyd, like several other oil companies like Shell, Caltex, Gapco, Moil, Mogas, Hass Petroleum, Mafuta, Kobil, Phoenix and Matan were on January 17 invited by the Permanent Secretary of the Ministry of Energy to submit bids to supply fuel to the Government Strategic fuel Reserves by January 22 .
The said companies were advised that the Government was opting for selective bidding as opposed to public tendering both of which are provided for in the procurement law, owing to the urgency and emergency of the situation occasioned by the disturbances following the disputed presidential elections in Kenya.
The above companies bid through this selective bidding and sent representatives to attend the bid opening on January 22 at the Ministry of Energy.
Upon the opening of the bids, Kenlloyd was declared the lowest bidder and was awarded the tender to supply the said fuel reserves and was also invited for discussions with officials of the Ministry of Energy that culminated in the signing of the contract to supply the fuel reserves.
Kenlloyd was advised by the ministry that the contract had been approved by the Ministry of Justice.
It is consequently not true, as alleged in the article, that there was no bidding. In contradiction of the allegation of “no biddingâ€, the newspaper states that “a total of 11 companies applied. The bids were opened on January 22...â€
Under the terms of the contract between Kenlloyd and the Ministry of Energy, there is no advance payment. In addition to executing a performance bond of $1,324, 263, which is 5% of the contract value. Kenlloyd is only entitled to payment against deliveries made. Consequently, there are no public funds at risk. On the contrary, Kenlloyd shoulders the risks.
The alleged flaws, if any, cannot be attributed to Kenlloyd.
We would also like to clarify that Elizabeth Kutesa is neither a shareholder nor a director of Kenlloyd as alleged in the article. Guaranteeing a loan and or borrowing does not imake one a director of a company. What is required is that the guarantor should be acceptable to the lender. Suitability of the guarantor is determined at the sole discretion of the lender.
It is true that Muganga is the executive director and majority shareholder of Kenlloyd Logistics but there is nothing wrong, legally or otherwise, with this. He is a hardworking, forthright, law abiding citizen. It cannot be the case and certainly is not in the law that a person who is related to an official of government is prohibited and or cannot do business independently with the Government.
The article also stated that Vitol Group was a partner of Kenlloyd Logistics and that in 2007, it pleaded guilty to larceny in connection with oil for food deal in Iraq and that it paid $13m in kick backs to Iraq officials for oil purchases.
Kenlloyd is neither Vitol’s partner nor its subsidiary. There was, therefore, nothing in this regard to be confirmed as alleged. Vitol is a reputable international company involved in the supply of fuel. It is strictly in this regard as supplier that Kenlloyd relates to Vitol. The allegations of guilt and kick back payments attributed to Vitol are unknown to Kenlloyd which in any event could not have been privy.
The writer is the Managing Director of Kenlloyd Logistics
WE refer to the article published in Sunday Vision, March 9, titled: “Oil deal haltedâ€. This article created the impression that Kenlloyd Logistics irregularly won a tender to supply fuel as a result of the influence and connections of Sam Kutesa, the Minister of Foreign Affairs, who is the father in law of Albert Muganga, one of the directors of Kenlloyd Logistics, and that public funds were at risk. We would like to clarify on the following issues:
Kenlloyd Logistics is a limited liability company incorporated in Uganda among others in the business of importation, buying and selling of fuel and fuel products.
The company has been in this business for a considerable period of time, it is law abiding and has duly been paying taxes to Uganda Revenue Authority (URA). As stated in the article, last year Kenlloyd paid taxes of up to sh1.5b. In the previous year, it paid sh1b in taxes.
Kenlloyd, like several other oil companies like Shell, Caltex, Gapco, Moil, Mogas, Hass Petroleum, Mafuta, Kobil, Phoenix and Matan were on January 17 invited by the Permanent Secretary of the Ministry of Energy to submit bids to supply fuel to the Government Strategic fuel Reserves by January 22 .
The said companies were advised that the Government was opting for selective bidding as opposed to public tendering both of which are provided for in the procurement law, owing to the urgency and emergency of the situation occasioned by the disturbances following the disputed presidential elections in Kenya.
The above companies bid through this selective bidding and sent representatives to attend the bid opening on January 22 at the Ministry of Energy.
Upon the opening of the bids, Kenlloyd was declared the lowest bidder and was awarded the tender to supply the said fuel reserves and was also invited for discussions with officials of the Ministry of Energy that culminated in the signing of the contract to supply the fuel reserves.
Kenlloyd was advised by the ministry that the contract had been approved by the Ministry of Justice.
It is consequently not true, as alleged in the article, that there was no bidding. In contradiction of the allegation of “no biddingâ€, the newspaper states that “a total of 11 companies applied. The bids were opened on January 22...â€
Under the terms of the contract between Kenlloyd and the Ministry of Energy, there is no advance payment. In addition to executing a performance bond of $1,324, 263, which is 5% of the contract value. Kenlloyd is only entitled to payment against deliveries made. Consequently, there are no public funds at risk. On the contrary, Kenlloyd shoulders the risks.
The alleged flaws, if any, cannot be attributed to Kenlloyd.
We would also like to clarify that Elizabeth Kutesa is neither a shareholder nor a director of Kenlloyd as alleged in the article. Guaranteeing a loan and or borrowing does not imake one a director of a company. What is required is that the guarantor should be acceptable to the lender. Suitability of the guarantor is determined at the sole discretion of the lender.
It is true that Muganga is the executive director and majority shareholder of Kenlloyd Logistics but there is nothing wrong, legally or otherwise, with this. He is a hardworking, forthright, law abiding citizen. It cannot be the case and certainly is not in the law that a person who is related to an official of government is prohibited and or cannot do business independently with the Government.
The article also stated that Vitol Group was a partner of Kenlloyd Logistics and that in 2007, it pleaded guilty to larceny in connection with oil for food deal in Iraq and that it paid $13m in kick backs to Iraq officials for oil purchases.
Kenlloyd is neither Vitol’s partner nor its subsidiary. There was, therefore, nothing in this regard to be confirmed as alleged. Vitol is a reputable international company involved in the supply of fuel. It is strictly in this regard as supplier that Kenlloyd relates to Vitol. The allegations of guilt and kick back payments attributed to Vitol are unknown to Kenlloyd which in any event could not have been privy.
The writer is the Managing Director of Kenlloyd Logistics