Dry service stations loom

The proposed takeover of 52 former Shell and Engen service stations by Nasan Energies has hit a major obstacle, with fuel supply arrangements and operational agreements still unresolved days before the Namibia Competition Commission’s (NaCC) conditions take effect.On 21 May, Vivo Energy informed affected service station owners and operators that no new fuel orders could be placed after Friday, 22 May 2026. Operators were also instructed to settle all outstanding accounts by today, 26 May.As of yesterday, Shell fuel payment cards could no longer be used at the affected service stations, while card terminals were scheduled to be collected by Vivo today.According to the Fuel and Franchise Association (FAFA), station owners and operators have not yet signed transfer agreements, nor are replacement wholesale agreements in place. FAFA further claims there is no compliance documentation or formal agreement with Nasan Energies regarding the takeover of fuel supply, and that the de-branding and re-branding processes have not been completed.Both Nasan Energies and FAFA have approached the Ministry of Industries, Mines and Energy, requesting an extension before the implementation of the NaCC conditions.Nasan has asked energy minister Modestus Amutse to allow it to continue operating under the same conditions as other operators. Alternatively, the company has proposed a transitional implementation period of 60 months, during which it would be allowed to procure petroleum products from any supplier, including Vivo Energy, Vitol or their affiliates.According to Nasan’s application, a review would then be conducted after the five-year period to determine the extent to which the company had transitioned its supply arrangements, with the possibility of a further extension if necessary.60-day extension askedFAFA, however, is requesting only a 60-day extension until 27 July 2026 to allow for what it describes as the orderly implementation of the NaCC conditions, which become effective on Wednesday, 27 May.The NaCC approved the transaction under conditions published in Government Gazette No. 8880 of 1 April 2026. These conditions prohibit Nasan from purchasing fuel from Vivo Energy, Vitol or any affiliated entities for a period of five years.During a public consultation meeting in February, the NaCC warned that the transaction could significantly increase market concentration. The commission’s director for enforcement, exemptions and cartels, Johannes Ashipala, said Vivo had already diverted fuel volumes away from the service stations earmarked for disposal, reducing their market share to around 10% instead of the concentration reduction originally envisaged by the commission.Ashipala also warned that the relationship between Vivo and Nasan after the transaction could raise competition concerns, with the two entities potentially controlling up to 70% of the fuel market.He further cautioned that Vitol already controlled between 75% and 85% of Namibia’s intra-wholesale fuel supply, creating risks to competition, employment and national fuel security.FAFA maintains it is not opposed to the NaCC conditions, but says additional time is required to implement them lawfully and without disrupting retailers, employees and consumers.According to FAFA chairperson Michael Ludeke, the association wants sufficient time “to give proper, lawful and orderly effect to those conditions” in a manner consistent with the Petroleum Act. He further argued that Vivo’s notification issued on 21 May does not comply with the requirements of section 4A of the Act.

Dry service stations loom

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Republikein 2026-05-26

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Dry service stations loom

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