Dear Honorable Minister,

Subject: Proposal for Critical Reforms in the Premix Fuel Sector

I extend my heartfelt congratulations to you on your appointment as the Minister of Fisheries and Aquaculture. Your leadership is a beacon of hope for addressing the pressing challenges faced by the fishing industry.

I write to propose critical reforms in the Premix Fuel sector to ensure its sustainability and efficiency. As you are aware, Premix Fuel is a vital resource for the fishing industry, yet its current management faces significant challenges that hinder its effectiveness. Below are the reforms I humbly suggest for your consideration:

1. Reduction or Total Removal of Government Subsidy

The government’s inability to pay under-recoveries (subsidies) to the Bulk Distribution Companies (BDCs) involved in blending Premix Fuel has led to frequent shortages and, in some cases, a refusal by BDCs to blend due to outstanding debts. To address this:

          •        A reduction of the subsidy from 50% to 25%, or its total removal, as advocated by many industry players, would alleviate the financial burden on government resources and ensure consistent availability of the product.

          •        The government could explore alternative support mechanisms to make the product affordable and accessible to fisherfolk without relying heavily on subsidies.

2. Abolishment of Tema Oil Refinery’s (TOR) Monopoly on Premix Fuel Blending

The policy mandating TOR as the sole producer of Premix Fuel has proven counterproductive due to its operational inefficiencies, resulting in frequent shortages and limited competition. To address this:

          •        Private refineries should be allowed to blend Premix Fuel under the regulation of the National Petroleum Authority (NPA), similar to other petroleum products.

          •        Major BDCs could also be permitted to import Premix Fuel directly, with government support such as guarantees for foreign refineries. This would enhance competition, reduce costs, and ensure reliable supply.

3. Enhanced Distribution and Monitoring Systems

Working closely with stakeholders, I propose the introduction of robust systems to address inefficiencies in the distribution of Premix Fuel. These systems should focus on:

          •        Eliminating ghost landing beaches.

          •        Cracking down on middlemen and third parties involved in product diversion, which denies fisherfolk access to the fuel.

Honorable Minister, these reforms will not only address the longstanding challenges in the Premix Fuel sector but also promote the sustainable growth of the fishing industry under your stewardship.

Thank you for considering these proposals. I remain committed to supporting your efforts to achieve transformative change in the sector.