Ngungula: Fuel retailers lose over N$230m in revenue over 9 years
Fuel retailers in northern Namibia say they have lost more than N$230 million in revenue between 2016 and 2024 due to the persistent cross-border smuggling of petrol and diesel from neighbouring Angola, known locally as ngungula.
The illicit trade has hit businesses in the Ohangwena, Omusati and Oshana regions hard, creating difficult trading conditions and significant financial losses.
Retailers have previously stated that unless authorities act, the smuggling crisis will continue to undermine legitimate fuel sales and local economies.
In response to a Namibian Sun enquiry, the mines and energy ministry last week confirmed the escalating fuel-smuggling problem in northern Namibia affects not only retailers but also tax authorities and the government, as smugglers deprive the state of levies that would have been collected if motorists had filled their vehicles at legal pump stations.
“The government is faced with a huge problem of fuel smuggling," Ten Hasheela, chief public relations officer for the ministry, said.
"This does not only pose challenges for the service station owners... but it also has economic and security implications,” Hasheela added.
Massive losses
The ministry confirmed that in June 2024, affected fuel retailers, through a letter from their lawyers, demanded immediate compensation for revenue lost between 2016 and 2024. The request included a fixed monthly margin of 82 cents per litre, to be paid exclusively to dealers in the affected regions until the illegal smuggling is permanently stopped.
“They also stated that fuel smuggling has created adverse trading conditions and substantial losses for fuel businesses in the affected regions, amounting to N$233 748 862,” the ministry added.
Additionally, the Namibia Local Business Association (NALOBA) cited a 2022 regional fuel sales survey in Ohangwena and Oshana, which showed more than 60% revenue loss per site due to fuel smuggling.
The ministry confirmed that, beyond the economic impact, the fuel-smuggling crisis has become a serious safety concern.
There have been reports of police officers being attacked by smugglers, resulting in injuries, property damage, and, in some cases, the use of firearms by officers to regain control.
For years, law enforcement agencies have struggled to tackle the problem effectively, while homesteads and open areas along the Namibia-Angola border have increasingly been converted into makeshift fuel stations.
Storage
Last week, Namibian Sun reported that some police officers entrusted with confiscating smuggled fuel have allegedly misused the contraband for personal gain.
Police inspector general Joseph Shikongo said he is aware of several active cases in the courts involving his subordinates.
The reports prompted this publication to investigate what happens to fuel after it is seized by the police.
The ministry explained that the fuel is collected by a company appointed in 2018 to dispose of smuggled fuel.
“The products posed a great fire risk to people, properties and the surrounding environment. Due to the urgency of the matter and the risk involved, the ministry decided to appoint an entity, a company or person, to collect, store, transport and possibly reprocess and reuse the fuel and/or dispose of it in an environmentally friendly manner.”
As a result, Wesco Waste Management (PTY) Ltd was identified and appointed and offered to remove the products from the police stations.
“The company demonstrated the capacity and ability to collect, store, transport, reprocess, reuse the fuel and/or dispose of the confiscated fuel in an environmentally friendly manner.”
Wesco operates oil-collecting depots in northern Namibia, with temporary storage facilities in Ondangwa and Tsumeb, as well as in Windhoek.
The ministry said Wesco has collected 1 211 180 litres of confiscated fuel between June 2018 and August 2024.
The ministry has also installed two storage tanks and three metal containers at Oshikango, Okalongo and Oshakati to help the police temporarily store the confiscated products safely. Empty containers are disposed of at the Helao Nafidi Town Council.
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The illicit trade has hit businesses in the Ohangwena, Omusati and Oshana regions hard, creating difficult trading conditions and significant financial losses.
Retailers have previously stated that unless authorities act, the smuggling crisis will continue to undermine legitimate fuel sales and local economies.
In response to a Namibian Sun enquiry, the mines and energy ministry last week confirmed the escalating fuel-smuggling problem in northern Namibia affects not only retailers but also tax authorities and the government, as smugglers deprive the state of levies that would have been collected if motorists had filled their vehicles at legal pump stations.
“The government is faced with a huge problem of fuel smuggling," Ten Hasheela, chief public relations officer for the ministry, said.
"This does not only pose challenges for the service station owners... but it also has economic and security implications,” Hasheela added.
Massive losses
The ministry confirmed that in June 2024, affected fuel retailers, through a letter from their lawyers, demanded immediate compensation for revenue lost between 2016 and 2024. The request included a fixed monthly margin of 82 cents per litre, to be paid exclusively to dealers in the affected regions until the illegal smuggling is permanently stopped.
“They also stated that fuel smuggling has created adverse trading conditions and substantial losses for fuel businesses in the affected regions, amounting to N$233 748 862,” the ministry added.
Additionally, the Namibia Local Business Association (NALOBA) cited a 2022 regional fuel sales survey in Ohangwena and Oshana, which showed more than 60% revenue loss per site due to fuel smuggling.
The ministry confirmed that, beyond the economic impact, the fuel-smuggling crisis has become a serious safety concern.
There have been reports of police officers being attacked by smugglers, resulting in injuries, property damage, and, in some cases, the use of firearms by officers to regain control.
For years, law enforcement agencies have struggled to tackle the problem effectively, while homesteads and open areas along the Namibia-Angola border have increasingly been converted into makeshift fuel stations.
Storage
Last week, Namibian Sun reported that some police officers entrusted with confiscating smuggled fuel have allegedly misused the contraband for personal gain.
Police inspector general Joseph Shikongo said he is aware of several active cases in the courts involving his subordinates.
The reports prompted this publication to investigate what happens to fuel after it is seized by the police.
The ministry explained that the fuel is collected by a company appointed in 2018 to dispose of smuggled fuel.
“The products posed a great fire risk to people, properties and the surrounding environment. Due to the urgency of the matter and the risk involved, the ministry decided to appoint an entity, a company or person, to collect, store, transport and possibly reprocess and reuse the fuel and/or dispose of it in an environmentally friendly manner.”
As a result, Wesco Waste Management (PTY) Ltd was identified and appointed and offered to remove the products from the police stations.
“The company demonstrated the capacity and ability to collect, store, transport, reprocess, reuse the fuel and/or dispose of the confiscated fuel in an environmentally friendly manner.”
Wesco operates oil-collecting depots in northern Namibia, with temporary storage facilities in Ondangwa and Tsumeb, as well as in Windhoek.
The ministry said Wesco has collected 1 211 180 litres of confiscated fuel between June 2018 and August 2024.
The ministry has also installed two storage tanks and three metal containers at Oshikango, Okalongo and Oshakati to help the police temporarily store the confiscated products safely. Empty containers are disposed of at the Helao Nafidi Town Council.
[email protected]
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