Ethiopian Petroleum Supply Enterprise (EPSE)

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Capitalising on crude in Ethiopia

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Petroleum Power Ethiopia’s sole importer and distributor of refined petroleum products, EPSE is helping to uphold the country’s rapid economic expansion Writer: Jonathan Dyble | Project Manager: Ben Weaver

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thiopia is a country on the rise.

Having recorded an average annual GDP growth rate of 10.3 percent between 2007 and 2017, Africa’s second most populous country has cemented its status as the continent’s fastest growing economy.

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Multiple industries have continued to prosper against this backdrop, from infrastructure to manufacturing to telecommunications, while investor confidence has also been consolidated and supported by an influx of foreign financing.

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“The future is bright for our country,” states Tadesse Hailemariam, CEO of Ethiopian Petroleum Supply Enterprise (EPSE) – an organisation that has come to embody this booming climate.

A nationally registered public enterprise that is the sole importer and distributor of sustainable refined petroleum products to the country, EPSE has been responsible for facilitating a significant spike in usage that has arisen in recent times.

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LEADERSHIP FOCUS TADESSE HAILEMARIAM A career in the oil industry wasn’t always on the cards for Hailemariam.

A geologist and geotechnical engineer by trade, he spent the early years of his career in this field, holding three distinct roles at the Ethiopian Institute of Geological Surveys between 1985 and 1996.

Branching out thereafter, he stood as the Project Manager for Addis Ababa Water Supply Authority’s Water III Project (199798); headed up the geotechnical division for Building Design Enterprise (1999-2005); and acted as Deputy CEO at Construction Design Share Company (2006-2013) before accepting his current position.

“Oil in many ways is related to geology, hence my interest,” Hailemariam reveals.

“When I undertook my postgraduate studies at the International Institute for GeoInformation Science and Earth Observation in the Netherlands, one of the university’s top professors, Dr Niek Rengers, told us how geology is everything.

“He explained how it applies to agriculture, infrastructure, medicine, environment, water, and therefore a geologist can be policy maker, planner, executioner and/or leader. This idea became the foundation for my aspirations and indeed career.”

“The demand for fuel is growing in parallel with the economy and, as a result, oil infrastructure including terminals, storage tank farms, pipelines and other related logistics are undergoing expansion and construction out of necessity,” Hailemariam affirms.

The statistics speak for themselves to this end. In 2013/14, for example, EPSE purchased 2,622,801 metric tonnes of petroleum products, a figure that rose to 3,501,759 metric tonnes by 2016/17.

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“It’s our role to identity and plan for this based on the number of vehicles, infrastructural projects, flights destined to Addis Ababa and other fuel consuming activities,” the Chief Executive adds.

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as the profound importance of Port Djibouti with Ethiopia being a landlocked nation.

Some gasoil and gasoline products are also purchased from Kuwait Petroleum Cooperation and Sudan Petroleum Corporation respectively, Going for growth while aviation fuel is often purchased Having initially been established in 1967 from the former. as Ethiopian Petroleum Association “Products are imported through Company, the organisation that has key entry points and ports across been know as EPSE since 2012 has Ethiopia,” Hailemariam explains. rarely deviated from its overriding “We then both distribute these to oil mission. marketers according to their market Commissioned to supply sustainable shares and store them in 13 strategic refined petroleum products including depots that we administer throughout gasoil, gasoline, kerosene, light fuel the nation. oil and heavy fuel oil to the country, it “Business is always about has done just this for the past 52 years, teamwork. We have very good procuring products via a series of open relationships with all our partners on international tenders. the supply chain and we will keep on The majority of these are acquired working closely with our customers via Djibouti, owed to both the strong and all stakeholders.” trade links, connections and relations This portfolio of depots and between the two countries, as well customers has continued to grow over

Fuel supply contract signing with Trafigura

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PETROCHINA INTERNATIONAL

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etroChina International (PCI) is a listed arm of a state-owned corporation, CNPC, and actively participates in global crude and refined products, trading for years through its overseas operations and value-added chain.

At the moment PCI operates four overseas refineries in Europe, Singapore and the Far East, besides 26 system refineries in China. PCI also owns and leases storage tanks in the Far East, Arab Gulf, Europe and America regions.

To date, PCI’s biggest involvement in the African market has been supplying 50 percent of the Ethiopia’s refined petroleum products requirements in 2017 and 2019. PCI is directly and indirectly involved in other African countries including, but not limited to Egypt, Kenya, Tanzania, Mozambique Mauritius, South Africa and some West African countries.

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PETROCHINA INTERNATIONAL (MIDDLE EAST) COMPANY LIMITED

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EPSE employees engaged in tree plantation

Business is always about teamwork. We have very good relationships with all our partners on the supply chain and we will keep on working closely with our customers and all stakeholders” the years as demand has grown and expansion has been required, a natural process that is still underway today.

“In terms of our own investments,” Hailemariam affirms, “we are in the process of building a new depot in Dukem, some 30 kilometres south of Addis Ababa. Feasibility studies have been completed and basic engineering is underway, with the expectation that this will be completed in July 2019.

“In turn, we will then begin the engineering, procurement and construction procedures and aim to have the depot up and running by mid-2022.”

This latest facility will be coupled with other EPSE network expansions including the organisation’s work on

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the Awash petroleum reserve depot that both stores products and acts as an inland terminal for distribution, further helping to bolster the company’s capacity in line with the upward trajectory of the economy.

Corporate social stalwart

To say that the provision of oil is the only way in which EPSE is helping to support the socioeconomic situation in Ethiopia, however, would be false.

Social development is considered to be of equal importance to the enterprise, the public entity showcasing corporate responsibility by adhering to best industry practice and setting an admirable example in keeping with

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environmental and safety regulations.

“We are very much concerned about the protection of the environment,” Hailemariam states. “Fossil fuel contributes significantly to air pollution, so we partake in extensive tree planting initiatives and subsequent caretaking activities like watering and cultivation to reduce our carbon footprint.”

Environmental programmes are not the organisation’s only emphasis in terms of social investment.

In addition, EPSE also forms close relationships with various communities across Ethiopia, helping to raise the quality of life and provide individuals with lifechanging services and facilities.

Hailemariam continues: “We provide support for those living close to strategic depots, availing clean water by sinking boreholes and dealing with other issues following the requests of the communities so as to build sense of ownership.

“We’re also proud of the fact that all our employees are national citizens. We

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Vitol is pleased to support EPSE For over 30 years, our partners in Africa have benefited from our global reach and logistical expertise, as well as our growing energy infrastructure footprint across the region.

Material donation for needy school children

16m m3 + of storage across seven continents

EPSE employees visiting Renaissance Dam under construction on the Blue Nile River

will sometimes consultant international experts from abroad, but otherwise rely on our experienced local teams with expertise in mechanical, civil, electrical and electromechanical engineering.”

Advocating investment

All things combined, be it the company’s bold expansion efforts or

its CSR initiatives, the Chief Exec is quick to reiterate his optimism when asked about the company’s prospects moving forward.

“In terms of our own goals, we’re hoping to diversify and introduce new ways of transporting fuel across Ethiopia,” he states. “Currently we are limited to truck-based transportation,

357 million tonnes of crude oil & products shipped annually

6,800 ship voyages each year

a method which is expensive when compared to the use of trains or dedicated pipelines, but it’s something that we’ll be addressing.”

Equally, Hailemariam holds a similar outlook for Ethiopia on a broad basis, standing as a staunch advocate for oil and gas investment.

He concludes, outlining these views: “I’d like to invite all parties interested in investing in oil and gas infrastructures, be it oil terminals, developing depots, pipelines, gas stations, and even exploring the use of industry automation, to do so.

“To repeat, there is a bright future for the industry and in turn Ethiopia’s economic growth.”

Ethiopian Petroleum Supply Enterprise eth-petroleum@ethionet.et www.epse.gov.et

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Ethiopian Petroleum Supply Enterprise (EPSE) P.O.Box: 3375 Tel:+251115513288,551 0045 Fax: +251115512938 eth-petroleum@ethionet.et www.epse.gov.et

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