The fuel contract for distribution service that was awarded to a local company costs more than $5 million. 

The $5,970,000 contract awarded to Petroleum Products Supplies Ltd (P.P.S.) in May this year was confirmed by the Ministry of Finance through its tender awardee for the month. 

The figure was deemed confidential by the Minister of Finance, Lautimuia Uelese Vaai who was asked during the time to confirm the contract. 

It has now been released publicly together with other public tender work on the Ministry of Finance website. 

The On-Shore Petroleum Terminal and Distribution Services is for five years and P.P.S. was the first local company to run and manage the fuel distribution system winning its first contract in 2003. 

According to the M.O.F. website, other companies that bid include Vital Energy Inc. and Samoa Fuel Products Limited. 

In a previous interview, the Minister for Finance said the successful bidder was awarded the contract after going through the normal procurement process. 

“This is a highly specialised business and there are not that many local businesses that operate it other than the big overseas companies like Shell, Mobil and others,” he said. 

“One of the main areas of concern is the fluctuating price of fuel and its impact. 

“The company does take on a lot of risk on the fuel increase and it is something that the Government can negotiate with the local company to buffer those costs so that it doesn’t have a major impact on us when the cost goes up…that is something that we don’t have control over if it was awarded to an overseas company.” 

He said the Government sees the importance of having a stable supply and avoiding disruption to fuel supplies adding the contract cost was confidential information.