Missing monies

The Directorate of State Oil Enterprises has failed the transparency test in a scrutiny of earnings and spending by Killid.

Commission from petrol pumps is its main source of revenue. The pumps are both private and state-owned, and the directorate charges 0.20 Afs on every litre of petrol sold by the retailer.

The Directorate of State Oil Enterprises has failed the transparency test in a scrutiny of earnings and spending by Killid.

Commission from petrol pumps is its main source of revenue. The pumps are both private and state-owned, and the directorate charges 0.20 Afs on every litre of petrol sold by the retailer.

According to figures provided to Killid, there are some 2,400 private petrol stations – 302 in Kabul – and 100 operated by the directorate.

Faridullah Sherzoy, chief of the Directorate of State Oil Enterprises, says some 4 million Afs (58,000 USD) in earnings from petrol stations are handed over every month to the government treasury. The directorate has roughly 1,800 people on the rolls.

However, interviews with the union of petrol-pump owners and individual dealers reveal the directorate’s earnings are more than what it hands over to the treasury every month. Based on information from the union in Kabul, every dealer sells between 2,200 and 10,000 litres daily. This would add up to monthly sales of some 45 million Afs (650,000 USD). The commission owed to the government is roughly 9 million Afs (130,000 USD) per month, roughly more than double the figure provided by directorate chief Sherzoy.

Officials in the Ministry of Commerce and Industries refused all requests for details of the directorate’s revenue and expense. Neither was the Ministry of Finance willing to entertain Killid’s repeated calls for information. Finance ministry authorities put the ball in the commerce ministry’s court, insisting that matters connected with oil revenue and expense were not part of their business.

Old concerns

Haji Ahmdzai, who heads the union of petrol pump owners in Kabul, says they have frequently sought transparency from the Directorate of State Oil Enterprises but their concerns have not been addressed. The union had even taken its concerns to previous president Hamid Karzai. Haji Ahmadzai says they have been told “You don’t have the right to interfere in this regard.” The general feeling among dealers is that the directorate is not handing over all the money it earns in commissions to the treasury.

Safiaullah, the manager at the Panj Setara Oil Pump Station in Kabul, says he pays some 150,000 Afs (2,175 USD) every month as tax to the Directorate of State Oil Enterprises. He insists the process of tax collection is transparent. According to him, in addition to the 0.20 Afs tax on every litre of petrol sold, the Ministry of Finance also collects some 250,000 Afs (3,625 USD) annually from a petrol station. Officials in the Directorate of State Oil Enterprises refused to give any information on earnings or expenses.

The directorate was set up in 1953. In disarray during the long years of war, it was revived under the interim government that was established after the fall of the Taleban regime in end 2001.

Azerakhsh Hafezi who is the head of the union of oil companies says the directorate controls only 3 percent of the oil market and the rest is under the private sector, a claim denied by the Ministry of Commerce. According to the ministry, 10 percent of the oil market is with the government.

Azerakhsh calculates state-owned enterprises have stocks of 40,000 litres of oil while it runs into millions in the private sector.

Directorate chief Sherzoy agrees the private sector has a much larger presence in a market that is constantly growing.

There was some effort to privatise the directorate but it did not succeed.

Afghanistan has oil and gas stocks to last three months, according to Ministry of Commerce and Industries Spokesman Musafer Quqandi.