17 Dec 2005

Marshall Islands capital risks fuel shortage

8:26 am on 17 December 2005

A dispute with Mobil Oil Micronesia over fuel pricing has put the Marshall Islands capital of Majuro in danger of running out of fuel by the New Year.

The Marshalls Energy Company is attempting to change fuel suppliers after more than 13 years with Mobil Oil Micronesia and has asked the United States government for an independent investigation of Mobil tactics in recent negotiations.

Company officials say at the current rate of power plant fuel use and fuel sales to fishing vessels, the Marshalls Energy Company has enough diesel to keep the lights on in Majuro for about two more weeks.

Without a new delivery of fuel to the utility company before the end of the month, it will have to either stop sales of fuel to fishing vessels, or ration power in order to maintain electric services in Majuro beyond the end of December.

A major difficulty facing the utility company is that fuel sales to fishing boats account for a major portion of the revenues needed to pay Mobil for an August delivery of US$7 million worth of fuel.