hass conne ct | 2018hasspetroleum.com/wp-content/uploads/2018/12/hass-newsletter.pdf · in 2016,...

HASS CONNECT | 2018

SERVICING NEW FRONTIERS

CONTENTS• Word from the Chief Executive Officer (C.E.O) 2

• Word from the Editor 3

• Somaliland – Fact File and Ministry Message 5

• Word from Country Manager – Somaliland 6

• Word from the Chief Operating Officer (C.O.O) 8

• Specialty Insights 9

• HASS Aviation 15

• HASS in Tanzania 16

• HASS in DRC 17

• HASS in Zambia 18

• HASS in Rwanda 19

• HASS in South Sudan 20

• HASS in Uganda 21

• HASS Foundation 22

H A S S P E T R O L E U M / D E C E M B E R / 2 0 1 81

H A S S P E T R O L E U M / D E C E M B E R / 2 0 1 8 2

Esteemed customers, suppliers, stakeholders and colleagues, welcome to this issue of Hass Connect.This is a bi-annual, in-house publication that provides a platform to exchange ideas, interact with customers and share experiences. It will also provide an avenue to communicate news items across our network in various countries.

Our company has transformed into a multinational organization with an asset base of over USD 200 M in over 10 countries in Eastern, Central & the Horn of Africa and the Middle East. We continue to offer a wide range of petroleum products i.e. diesel fuel, automotive gasoline, kerosene, aviation fuel, Liquefied Petroleum Gas (LPG), lubricants for industrial & automotive systems and fuel oil.To sustain our growth and provide a stronger foundation, we entered into a strategic partnership with Oman Trading International (OTI). This links Hass Petroleum’s strong downstream opportunities to OTI’s petroleum trading and upstream capabilities hence providing synergy between our businesses.This year, Hass Petroleum also went into a product distribution agreement with Oman Oil Marketing Company. This was in an effort to increase our lubricant products range and get access to the OM certified specialized range, catering to the niche market.Kenya, Uganda, Tanzania, Zambia and the Horn of Africa remain our focused growth markets for the next two years. Our product diversification strategy is on course as we move into 2019.Our aviation portfolio continues to do well in our key markets, with state-of-the-art facilities in the Horn of Africa, South Sudan and Kenya. Today, Hass Petroleum supports a number of leading brands in the airline industry in various markets such as Lufthansa and Air Mauritius.We also heavily invested in the LPG sector by providing exciting solutions for our customers in terms of eased access to products as well as providing extra safety requirements. Our fireproof, composite LPG cylinders launch in the volatile market of Somalia, amongst others, is aimed at providing added value. From the mature markets like Kenya to the upcoming ones like Somalia, we are excited about the warm reception and positive feedback we constantly receive.We have recruited the best personnel who solely drive well-defined processes and procedures that conform to the internationally recognized quality, environmental and health safety requirements by ISO. At Hass, we are committed to continuously enhancing the skill base of our workforce. We deploy resources towards staff training and skill upgrade across all departments. As members of the Hass team, we must, therefore, take advantage of any opportunities to upgrade our skills and competence. This will enable us to be well positioned for the exciting opportunities that our industry gives.Honesty, integrity, initiative, hard work and innovative minds are the ingredients that guarantee success within Hass Petroleum. I urge all to understand the history of the business, to appreciate and internalize the culture of efficiency that has brought us this far. At Hass Petroleum, nothing is impossible and the customer is the centre of each activity.The task is upon us, as we move into the next phase of our growth, to keep the momentum by identifying opportunities in this ever-competitive industry. Creativity, innovation and unrelenting determination must continue to be the pillars of our growth.Finally, ours has always been a socially responsible company that cares about the welfare of the communities within which we do business. Through the Hass Petroleum Foundation, continue to allocate a proportion our revenue to support community-based initiatives especially in the fields of education, health and provision of clean water. Our commitment to giving back remains stronger. I would like to thank all those who supported our initiatives in one-way or the other.Welcome, once again, to this issue of Hass Connect. Please feel free to give us your feedback so that we can continue to improve the quality of our content.

Issa MohamedChief Executive Officer, Hass Petroleum

CEO’S MESSAGE


It is our great pleasure to present to you this special issue of Hass Connect with a special focus on our business in Somalia. It has been a transitional year for our business, starting with the introduction of our strategic partner, Oman Trading International (OTI). This change in composition marks the beginning of a new stage of development as we seek to position Hass Petroleum firmly within the top petroleum companies in the region. By maintaining our broad scope, encompassing all areas of petroleum products

importation, storage, distribution & marketing we continue to build on substantial experience to strive for a higher standard of service delivery. Our strategic partnership with OTI has secured the funds to support our expansion, global experience and expertise that will curve our multinational journey. In this issue, we delve into our business nerve centres delivering not only our activities in the regions but unlocking the industry happenings that have shaped the way we trade.But our journey is not without context. Today, East Africa is renown as the emerging oil patch with recent discoveries of crude oils that might transform petroleum in the future. The region is also aggressively amplifying connectivity through rail, pipeline and road. Furthermore, Kenya, Tanzania and Somalia have secured finances to expand their ports aimed at increasing product inflow into the region. These activities supported by the now active bilateral economic alliances such as East Africa Community Common Market, COMESA and others. Energy has remained a key contributor and driver for the envisioned development across Africa. We find ourselves at the center stage of an exceptional economic wave, with the sole role of energizing the consequent transformational process happening across the continent. Hass, of all marketing oil companies in the region, is best placed to leap into this role. We are backed by unmatched experience, strong financial backbone, strategic distribution & retail network and unique product access points such as Somalia anchored on standardized processes and procedures.In truth, Hass Petroleum is on a unique and triumphant journey. Our shared vision has borne the multinational business that we celebrate today. It is now upon us to share the trailblazing activities that keep Hass afloat, hence this issue. Hass Connect was developed to provide an engaging platform for our stakeholders, customers, industry regulators and governments. We strongly believe that our industry input as well as active collaboration aligns with our core mission of an overall industry improvement that will seek to fulfil customer needs in the most innovative & profitable way.Finally, I would like to thank our esteemed team for taking the time to work on the content available in this issue and for working tirelessly to write the Hass Petroleum story.

Abdirizak Ahmed Group Marketing Manager - Hass Petroleum

EDITORIAL FORWARD

Today, East Africa is renown as the emerging oil patch with recent discoveries of crude oils that might transform petroleum in the future.

Today, there are about 10 active petroleum importers in Somalia owned by both locals and foreign nationals.


SOMALILAND INDUSTRY UPDATECOUNTRY OVERVIEW Capital: Hargeisa Population: 4.5 million (UNPO, 2017)Major languages: Somali, Arabic & EnglishMajor religion: IslamCurrency: Somaliland shilling / USDGDP: $2 billion

Market OverviewThe ministry has made significant strides in promoting trade & industry in Somaliland in a drive to improve the livelihoods of an estimated 4.5 million people. Today, there are about 10 active petroleum importers in Somalia owned by both locals and foreign nationals. The sector has grown to an estimated 10M3 monthly capacity driven by the aggressive development projects currently underway in the country. The same is expected to grow especially once investors extend services to lucrative rural Somaliland. We are also experiencing gradual growth in the Liquefied Petroleum Gas (LPG) and lubricants segment as driven by our growing population.In June 2016, the Somaliland government signed an agreement with DP World to manage and extend the strategic port of Berbera. This move was with the aim of

enhancing productive capacity and acting as an alternative port for landlocked Ethiopia. The port serves as the main entry and exit point for imports and exports into global markets. This project also includes a road network development connecting the port to Ethiopia, consequently flourishing trade with the region and within Somalia. This will also amplify petroleum in country consumption especially to support trucking services. Somaliland is also endowed with hydrocarbon reserves; the ministry has made significant strides in commissioning a survey that will ideally give an indication of potential and size of the same available within Somaliland. Somaliland hopes to be part of this burgeoning East African oil patch including Uganda, Kenya, Tanzania, Madagascar and Ethiopia that have experienced great successes in making major oil and gas discoveries. Unfortunately, Somaliland delayed international recognition might discourage timely actions in this front. To reach our petroleum vision & plans, we need the investment of indigenous companies such as Hass Petroleum who are willing to risk a lot of their investments for the sake of our shared development goal.


By Abdirisaq Ibrahim Mohamed Director, Hass Petroleum - Somaliland

HASS SOMALILANDANGLED TO TAP GROWINGBUSINESS OPPORTUNITIESANCHORED ON STABLEPOLITICAL ENVIRONMENT

Hass Petroleum in SomaliaHass Petroleum Somaliland was started in September 2011, then the first Hass Petroleum vessel ferrying 5000M3 of product docked at the Berbera port. At the time, the Somaliland fuel consumption was estimated at 9000M3 per month. This would secure 60% market control at the time of Hass Petroleum’s launch in Somaliland. We started at this stage, but what was interesting was when the vessel arrived we had no employees, offices or any way of professionally managing our accounting. It was my sole duty to receive and distribute the product, at a profit nonetheless. Later after an audit was conducted, I was pleased to find that I had done well and within three weeks of sales, I had not made any error. This was good news.Between 2013-2014 we were able to control the market with very little competition, therefore, gaining market confidence. In 2014, our competitors decided to aggregate their businesses to develop competitive muscle that would counter Hass Petroleum’s growing leadership. On our part, we initiated dealer station branding. Branding at the time was still a foreign concept in Somalia. This new idea amplified our brand visibility, equity and ultimately placed Hass Petroleum at the petroleum sector centre stage. In 2015, a price war erupted supported by long-term credit extension to customers, which to-date continues to be a huge setback for companies in Somaliland. Some of the companies have closed because of crippling credit given to wholesale & retail customers. Today, only three companies remain in the petroleum sector all eyeing a growing 10000M3 combined product market. Hass Petroleum controls an estimated 48% of the entire market, key market drivers include 200 independent fuel stations, consumer accounts as well as own retail stations. In terms of individual vehicles, the segment also continues to grow especially driven by very low taxation for vehicle imports. Most Somaliland people own personal vehicles. However, increasing public service transport supports this.

In 2016, Hass Petroleum launched the first company-owned station in Burao and by the end of 2018, the number is expected to rise to 10. In terms of specialities, the Hass lubricants line was launched in Hargeisa in 2015, with LPG following in April 2018. Now international brands control most of the lubricants business, as we continue to improve market confidence through varied market activities that include trade and customer product trainings.

The LPG business – Launch & growthIn April 2018, Hass Petroleum made a move into the Liquefied Petroleum Gas (LPG) market segment by launching the eco-friendly, highly safe and hassle-free Hass Gas composite cylinder. The launch was preceded by the installation of a 300M3 LPG filling infrastructure in Hargeisa along Berbera Road. This state-of-the-art plant is backed by a robust supply chain model constituting of 50 LPG ISO-tanks aimed at ensuring sustained and steady supply. To support the storage facility, Hass Petroleum has also committed a chartered LPG vessel for Hargeisa as a base for re-export for the neighbouring countries.In the last six months, Hass Petroleum Somaliland’s dedicated infrastructure and determined delivery model has supplied LPG to over 3500 households in Somaliland and continues to grow by at least 500 every month. Incidentally, LPG, priced relatively the same as charcoal in Hargeisa, continues to lead as the main energy source for the people of Somalia and Somaliland. Today, Hass Gas has leapt to the 2nd position in the market especially championed by the non- explosive, aesthetically superior and portable cylinders. Hass Gas’ market penetration has also been driven by our 24-hour sale point model, meaning at any time during the day or night, customers can call our hotline for delivery. 24-hour delivery is a pioneer concept here. The current refill plant targets Hargeisa and will be supported by another LPG plant being developed in Garowe for the Puntland region clientele.

Somaliland fuel distribution, storage & explorationPetroleum products in Somalia get to Somaliland through Berbera Oil Terminal (BOT). BOT is a world-class, onshore oil storage facility based in the rapidly developing port of Berbera, Somaliland outside the Straits of Bab Almandab on the Gulf of Aden. BOT is a 51000M3 independent third-party storage and owned by the Government of Somaliland. Recently, traders in Somaliland have sought to source diesel from Ethiopia where it is liberalized and subsidized under their new government alignment. Supply across Somaliland from terminal and Ethiopia is done by trucks as there is no pipeline infrastructure in Somalia. Low taxation as well as lower transportation costs have ensured a stable pump price of around USD 0.70.Currently, Hass Somalia supports over 200 independent stations from Ethiopia and Berbera. Berbera Port does not have aviation product capacity and hence now Jet A1 is only availed by road from Djibouti.The Ministry of Petroleum in Somaliland has increased efforts around facilitation for local and foreign companies’ participation in petroleum trade. Furthermore, the Ministry has begun a survey of oil reserves to establish Somaliland’s capacity and set stage for future exploration. Exploration will be determined by Somaliland international recognition as well as support.

Politics & economy in SomalilandSomaliland is still not internationally recognized as an independent state, despite declaring independence almost 25 years ago; however, the country remains stable. Businesswise, Somaliland is very favourable because of its current political stability as well as a continuously growing skilled workforce. Somali people

are risk takers and heavy spenders; the circulation of cash is good and encouraging for cash business. Now, as Somalia & Somaliland continue discussions on independence, businesses remain hopeful that the discussions will bear fruit and secure continuity.

Hass Somaliland business forecastWe expect a lot of activities in the coming months. Currently, the USD 450 million Ethiopia Berbera Port is under construction. This is an investment that will ensure extended terminal capacity, consequently easing product entry into Somaliland. The project also includes a road to Ethiopia from Berbera, which will amplify our trade with Ethiopia. Hass Petroleum Ethiopia hopes to tap this opportunity while growing retail capacity to be able to safeguard our market leadership.

Hass Petroleum Somaliland overview • We are in our 7th year of operation in Somaliland.• Hass Petroleum has pioneered in the

operationalization, transformation and regularization of fuel business industry in Somaliland.

• We ensured consistent, cost-effective and quality supply of fuel over the past seven years.

• We have an investment of over 20 retail networks across Somaliland and a direct/indirect workforce of 300 personnel.

• Somaliland is the key operational sector for the Group. Our shared Services Centre is now located in Hargeisa and was chosen on the basis of the country’s stability, tranquillity, established technological infrastructure and the hospitality of the people.

• As CSR, we are working with the Government of Somalia in enhancing compliance, regulatory and policy framework for the fuel industry.


Hass Petroleum in SomaliaHass Petroleum Somaliland was started in September 2011, then the first Hass Petroleum vessel ferrying 5000M3 of product docked at the Berbera port. At the time, the Somaliland fuel consumption was estimated at 9000M3 per month. This would secure 60% market control at the time of Hass Petroleum’s launch in Somaliland. We started at this stage, but what was interesting was when the vessel arrived we had no employees, offices or any way of professionally managing our accounting. It was my sole duty to receive and distribute the product, at a profit nonetheless. Later after an audit was conducted, I was pleased to find that I had done well and within three weeks of sales, I had not made any error. This was good news.Between 2013-2014 we were able to control the market with very little competition, therefore, gaining market confidence. In 2014, our competitors decided to aggregate their businesses to develop competitive muscle that would counter Hass Petroleum’s growing leadership. On our part, we initiated dealer station branding. Branding at the time was still a foreign concept in Somalia. This new idea amplified our brand visibility, equity and ultimately placed Hass Petroleum at the petroleum sector centre stage. In 2015, a price war erupted supported by long-term credit extension to customers, which to-date continues to be a huge setback for companies in Somaliland. Some of the companies have closed because of crippling credit given to wholesale & retail customers. Today, only three companies remain in the petroleum sector all eyeing a growing 10000M3 combined product market. Hass Petroleum controls an estimated 48% of the entire market, key market drivers include 200 independent fuel stations, consumer accounts as well as own retail stations. In terms of individual vehicles, the segment also continues to grow especially driven by very low taxation for vehicle imports. Most Somaliland people own personal vehicles. However, increasing public service transport supports this.

In 2016, Hass Petroleum launched the first company-owned station in Burao and by the end of 2018, the number is expected to rise to 10. In terms of specialities, the Hass lubricants line was launched in Hargeisa in 2015, with LPG following in April 2018. Now international brands control most of the lubricants business, as we continue to improve market confidence through varied market activities that include trade and customer product trainings.

The LPG business – Launch & growthIn April 2018, Hass Petroleum made a move into the Liquefied Petroleum Gas (LPG) market segment by launching the eco-friendly, highly safe and hassle-free Hass Gas composite cylinder. The launch was preceded by the installation of a 300M3 LPG filling infrastructure in Hargeisa along Berbera Road. This state-of-the-art plant is backed by a robust supply chain model constituting of 50 LPG ISO-tanks aimed at ensuring sustained and steady supply. To support the storage facility, Hass Petroleum has also committed a chartered LPG vessel for Hargeisa as a base for re-export for the neighbouring countries.In the last six months, Hass Petroleum Somaliland’s dedicated infrastructure and determined delivery model has supplied LPG to over 3500 households in Somaliland and continues to grow by at least 500 every month. Incidentally, LPG, priced relatively the same as charcoal in Hargeisa, continues to lead as the main energy source for the people of Somalia and Somaliland. Today, Hass Gas has leapt to the 2nd position in the market especially championed by the non- explosive, aesthetically superior and portable cylinders. Hass Gas’ market penetration has also been driven by our 24-hour sale point model, meaning at any time during the day or night, customers can call our hotline for delivery. 24-hour delivery is a pioneer concept here. The current refill plant targets Hargeisa and will be supported by another LPG plant being developed in Garowe for the Puntland region clientele.

Somaliland fuel distribution, storage & explorationPetroleum products in Somalia get to Somaliland through Berbera Oil Terminal (BOT). BOT is a world-class, onshore oil storage facility based in the rapidly developing port of Berbera, Somaliland outside the Straits of Bab Almandab on the Gulf of Aden. BOT is a 51000M3 independent third-party storage and owned by the Government of Somaliland. Recently, traders in Somaliland have sought to source diesel from Ethiopia where it is liberalized and subsidized under their new government alignment. Supply across Somaliland from terminal and Ethiopia is done by trucks as there is no pipeline infrastructure in Somalia. Low taxation as well as lower transportation costs have ensured a stable pump price of around USD 0.70.Currently, Hass Somalia supports over 200 independent stations from Ethiopia and Berbera. Berbera Port does not have aviation product capacity and hence now Jet A1 is only availed by road from Djibouti.The Ministry of Petroleum in Somaliland has increased efforts around facilitation for local and foreign companies’ participation in petroleum trade. Furthermore, the Ministry has begun a survey of oil reserves to establish Somaliland’s capacity and set stage for future exploration. Exploration will be determined by Somaliland international recognition as well as support.

Politics & economy in SomalilandSomaliland is still not internationally recognized as an independent state, despite declaring independence almost 25 years ago; however, the country remains stable. Businesswise, Somaliland is very favourable because of its current political stability as well as a continuously growing skilled workforce. Somali people

are risk takers and heavy spenders; the circulation of cash is good and encouraging for cash business. Now, as Somalia & Somaliland continue discussions on independence, businesses remain hopeful that the discussions will bear fruit and secure continuity.

Hass Somaliland business forecastWe expect a lot of activities in the coming months. Currently, the USD 450 million Ethiopia Berbera Port is under construction. This is an investment that will ensure extended terminal capacity, consequently easing product entry into Somaliland. The project also includes a road to Ethiopia from Berbera, which will amplify our trade with Ethiopia. Hass Petroleum Ethiopia hopes to tap this opportunity while growing retail capacity to be able to safeguard our market leadership.

Hass Petroleum Somaliland overview • We are in our 7th year of operation in Somaliland.• Hass Petroleum has pioneered in the

operationalization, transformation and regularization of fuel business industry in Somaliland.

• We ensured consistent, cost-effective and quality supply of fuel over the past seven years.

• We have an investment of over 20 retail networks across Somaliland and a direct/indirect workforce of 300 personnel.

• Somaliland is the key operational sector for the Group. Our shared Services Centre is now located in Hargeisa and was chosen on the basis of the country’s stability, tranquillity, established technological infrastructure and the hospitality of the people.

• As CSR, we are working with the Government of Somalia in enhancing compliance, regulatory and policy framework for the fuel industry.

In the last six months, Hass Petroleum Somaliland’s dedicated infrastructure and determined delivery model has supplied LPG to over 3500 households in Somaliland and continues to grow by at least 500 every month


You are the first to hold this role. Why was it important for you to take up this position at Hass Petroleum and why at this point in your career? The main reason I joined Hass is that I was convinced the role was a challenging one, with a wider scope. I have been in the industry for a while now and within the region, but I had not covered unique markets such as Somalia and Somaliland. I believe this role will enhance my learnings while utilizing my skills and talents for business growth. Listening to the shareholders, that is both Hass Family and Oman Trading International, I was convinced that our vision of growing the business with a customer focus, building the retail network through innovation, were aligned, for that reason I decided to join Hass and hopefully, we would grow the business together. And how has that been so far?It has been a big task, mainly because of external factors such as competition in all our markets, for instance in Kenya the development of the pipeline, infrastructure upgrade, matched with increased market players has resulted in very stiff competition. For the first time we are seeing supply exceeding demand, the same experience applies to Somalia, Somaliland and Tanzania. It is a big challenge but it is an exciting journey to convert these challenges into opportunities for Hass Petroleum Group. What are some of the exciting things happening in the industry today?I think there are many opportunities in the market across all segments. We are confident that the Liquefied Petroleum Gas (LPG) segment will grow, anchored by a growing population, extended middle class as well as reduced forest cover across the region. At Hass, we see this as an opportunity to grow our LPG segment. Another opportunity is the growing Chinese investor activity in the region. We are crafting partnerships that will allow us to fulfil their energy needs. We have existing relationships with many Chinese firms and we intend to leverage on this to propel our business to the next level.Of course, there are also a lot of advantages to our growing real estate, or the increased retail stations that could house complementary businesses such as convenience stores, financial services, telecommunications etc. Internally, we are also looking to increase our efficiency and to optimize our processes to support the desired growth.

What other challenges exist in our market today and how is Hass preparing to convert them to opportunities?The nature of the market presents a challenge around foreign currency exchange losses and so there are challenges that come with frequent fluctuations. Again, when the local economies are not doing well, our customers also suffer and hence the issue of credit management arises. Our business has evolved and continues to innovate to increase our efficiency around supply and demand management as well as to grow a robust credit management system that will help us wade through some of the collection challenges in the market today. We are currently undertaking a comprehensive market audit to uncover intrinsic customer requirements & needs to help us deliver products & services effectively, in time, appropriately and at customers utmost convenience. The retail sector is still our growth centre and it is very close in character to fast moving consumer goods and therefore it is imperative to remain engaged and in conversation with the customers to attain & retain relevancy. This applies for LPG, lubricants as well as our non-fuel business.Finally, what are your thoughts on Somaliland: our focus country for this edition? Somaliland is becoming more secure and open. The consequence of this is that more players are feeling comfortable going there, so the competition is starting to increase. Another occurrence that might affect Somaliland strategically will be the improved relationship between Eritrea and Ethiopia. This allows for entry to Ethiopia through the Eritrea route and this increases the product volumes in Somaliland. The other thing is the liberalization of the Ethiopian economy which means there is a possibility of products coming from Ethiopia to Somaliland and vice versa. This will change the market dynamics. This also means that Somaliland can serve as a hub for product moving into the Greater Northern region consisting of Djibouti, Ethiopia and Eritrea. This will serve as a launch pad for us to test the Ethiopian market as it becomes more liberalized and consequently more profitable. Also, within Somaliland, as the population grows, the middle class expands. We believe this presents an opportunity, especially for our LPG and fuel sectors, with a complementary increased retail network. Our approach will be to strategically grow our business with the economy and the people of Somaliland.

MEET OUR NEW GROUPCHIEF OPERATING OFFICER

Solomon Osundwa, a downstream oil sector master, most recently the Regional Director at VTTI Kenya in charge of the Eastern Africa region has joined Hass petroleum as the Group’s first Chief Operating Officer. Solomon is a Harvard Business School alumnus and has worked on other renowned brands in the FMCG, Oil & Gas industry including Unilever, Kenol Kobil, Caltex Oil Kenya Ltd. and Hashi Energy.Hass Connect team caught up with Solomon to look back at his initial months at Hass Petroleum, discuss where the future of oil & gas in East Africa lies and to find out how he is getting on with his new role. Excerpts below:


UNLOCKING CLEANENERGY OPPORTUNITIESIN THE REGIONBy Ahmed YunisGeneral Manager Specialties, Hass Petroleum

Over the years Hass Petroleum has grown steadily across East, Central and the Horn of Africa, fundamental to that growth has been our motivation to provide good quality, innovative and affordable energy to the customers we serve. Relatedly, Hass Gas our flagship Liquid Petroleum Gas (LPG) brand is increasingly becoming one of our key business growth catalyst closely following our white fuels segment. In truth, product innovation and extension has also significantly secured our customers’ confidence. Most recently the Hass Petroleum Group announced the introduction of a composite cylinder, a first in the region. The safe cylinder has become popular fast and will continue to contribute to our growth within the LPG segment regionally. In growing our LPG capacity in Kenya, we intend to establish LPG filling plants in Nairobi & Kisumu the plants are expected to be operational by the end of 2018. The plants will serve as our in-house filling sites and will also be available to other LPG marketers under our competitive and profitable hospitality program.Without question, the link between energy and economic growth aspirations of any country is pivotal, and there is a clear argument that LPG has an increasingly important role to play by providing a safe, affordable, convenient, and cleaner fuel. In Kenya the Government has put in place plans to expand the oil marketing industry’s capacity to import, store and distribute LPG more economically. The Government through Kenya Pipeline Company is in the process of setting a shared LPG storage facility in Mombasa where all OMCs will store their products before moving it to their inland storage facilities. This will be followed by shared import mechanic comparable to the fuel Open Tender System that will regulate both pricing and access across the industry however It is not clear when this share facilities of KPC will be operational. The Government has also initiated community subsidies for cylinder purchase to ensure all Kenyans can access this clean fuel. Indeed, this has already begun through The Mwananchi Gas program. The government has suspended the cylinder subsidy program due to corruption allegation and quality issues of the cylinder.

The program is inspired by the government drive to promote environmental conservation through provision of less pollutant fuel across all Kenyan homes. Under this project, 6Kg complete cylinders (gas, burner & grill) retailed under the brand name “Gas Yetu” is being distributed at a discounted price of kshs. 2000. Additionally, the government has developed a robust distribution model that will enable Kenyans in all the counties access LPG at the nearest shopping center through licensed distributors and retailers. This program will unlock LPG potential in the market while educating the public on safe fuel usage for sustainable development.We are also looking forward to a trailblazing Energy Regulation Commission LPG bill scheduled for parliamentary debate designed to strengthen LPG import and distribution regulation. As you are aware, illegal filling has continued to paralyze the business for licensed companies while discouraging further investment. With this new bill and dedicated enforcement, we believe the industry will be more stable, and dedicated to serving customer needs at the most affordable and efficient manner.The Hass Petroleum to strength its position as leading supply of LPG in the region has invested in state of art filling plant in Hargeisa Somaliland. Hass petroleum Somaliland is only company that has introduced composite cylinders in the market. We are also in process of upgrading our storage facilities in Uganda and Somalia. In both countries we are increasing our storage facility by 65mt.The tanks will be installed before the end of year.Further we are planning to set up LPG filling plants in Gorowe in Puntland Region of Somalia and Lusaka in Zambia.In the Southern African front, we have signed LPG supply agreement with the Union of Comoros which is expected to start in December. As part of our long-term plan we are targeting Ethiopia and Djibouti through direct investment or supply agreement .

We are also looking forward to a trailblazing Energy Regulation Commission LPG bill scheduled for parliamentary debate designed to strengthen LPG import and distribution regulation.


PICTORIAL

1. Chairman Hass Petroleum Abdinasir Ali Hassan with John Munyes Cabinet Secretary for Petroleum and Mining and Hon Abdirashid Mohamed Ahmed (R)Somali Federal Minister of Petroleum & Mineral Resouces

2. Daddy Konkwe, Admin Manager, Shukri Ahmed, Country Manager, Sarah Kita Accountant Assistant and Christian Bel Air Station Supervisor at Hass DRC staff forum

3. Hass Berbera Road Opening Ceremony at Hargeisa

4. A customer receives Hass lubes during the Bungoma Station launch roadshow

5. Hass Petroleum Kenya team during the CEO forum held at the end of Q2

6. Hass Petroleum team during the 2018 staff dinner early in the year

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7. Hass team at a Kenya and Somalia Ministerial meeting hosted by John Munyes, Minister Petroleum and Mining Kenya

8. Hass team During The Hass Petroleum JujaRoad Launch

9. Hilary Osodo, Country Manager Kenya, presents Ramadhan giveaways to the administrator at the Fatuma Homes in Eastleigh

10. Mohamoud Salat Chief Finance Officer at Hass Petroleum with SEK KIPOI team in DRC during a customer visit.

11. Mr Hillary Osodo hosts Bungoma county officials at the newly launched Hass Bungoma Station


REGIONAL OUTLOOK FOR LUBRICANTEARNINGS IS OPTIMISTIC, OMAN OIL MARKETING DISTRIBUTION DEAL TO INCREASE HASS SALESBy Michael ObingoLubes Technical Manager, Hass Petroleum

Base oil prices have risen by over 40% this year in line with increasing crude oil prices. US sanctions on Iran are expected to exacerbate the problem. This has caused lubricants’ prices to increase by about 10 % in the past year and we expect additional price increases in the coming year.Demand for synthetic oils for new model diesel and petrol engines is growing in Kenya, while the 2T motorcycle oil is expected to be obsolete by the year 2020 due to Euro E5 Emissions Standards. The Uganda Bureau of Standards is mulling over banning API CD/SG oil lubricants by 2019 following Tanzania, who introduced the same ban in 2016. While in Kenya, the Kenya Bureau of Standards (KEBS) has introduced, from June 2018, mandatory laboratory testing for lubricants by SGS, Bureau Veritas, Intertek etc. before shipment. This is in an effort to stamp out recycled and substandard lubricants.Tanzania has introduced an import permit for lubricants with greater restrictions for importers. This has translated to having fewer lubricant brands of questionable quality in the Tanzanian market and has given an opportunity for Hass Lubricants to penetrate the Tanzania market.Total Tanzania is awaiting the Fair Competition Commission of Tanzania to approve its Fuchs Blending Plant buyout. Fuchs has subsequently left the Kenyan market due to the resultant supply constraints.Lake Oil is introducing its lubricants brand in Kenya and Tanzania after opening their own Lubricants Blending Plant in Dar es Salaam in September. National Oil Corporation of Kenya has introduced the Hyrax Oil brand of lubricants from Malaysia, intensifying competition in both countries. However, Sepyana looking for a buyer for its blending plant in Nairobi.Uganda has increased its import duty to 35% from 25% making imported lubricants outside of COMESA much more expensive.In general, customers across the region are getting more knowledgeable on lubricants’ properties and qualities, hence increasing their sensitivity in the choice of lubricants used. Governments are equally rising to the challenge in stamping out substandard lubricants. Every Oil Marketing Company must strive to train their staff more on lubricants issues while insisting on only marketing quality lubricants so as to remain relevant in the

market. Yes, we still have at least a decade before we can worry about electric cars.Hass Kenya successfully launched Oman Oil Range of lubricants in July 2018, with the support of the Oman Oil team lead by Mr David Khalife, Chief Executive Officer at Oman Oil Marketing and Mr Issa Sheikh, Chief Executive Officer at Hass Petroleum.The aim of introducing Oman Oil lubricants in Kenya is to combine the most advanced technology with ongoing research and development innate to the Oman Oil lubricants brand. They are sold across the Middle East, North Africa and Indian Sub-continent including Bahrain, Yemen, Ethiopia and Bangladesh for more than ten years now. Customers can now use the Oman Oil lubricants, which also come with Original Equipment Manufacturers (OEM) Recommendations from Mercedes Benz, MAN Trucks, Volvo and Renault. Oman Oil also offers additional used oil analysis when requested.Since the launch, we have had very positive response from established transporters like Kyoga Hauliers, East Africa Roadways, Mombasa Maize Millers amongst others after using the Diesel Engine Oil Maximo Ultra. The second phase of the introduction is targeting the Hass Retail Network in Kenya starting from October 2018. Additional planned activities include a meeting with fleet owners in Mombasa and branding of several major partner garages. The Hass brand of lubricants led by Atroil will continue to be sold across the Hass Group and we have plans to get the Atroil Gold Diesel Engine Oil recommended by Mercedes Benz by late 2019.

Hass lubricants


A FOCUS ON PETROLEUMINDUSTRY DEVELOPMENT,CHALLENGES & OPPORTUNITIESBy Bernard OtienoGroup Supply & Trading Manager, Hass Petroleum

Recently the Kenya Pipeline Company commissioned the Nairobi–Mombasa Oil Pipeline, known as Line 5. The new line, once completed, will adequately serve the country’s demand which is projected to be 6.8 billion litres by 2020. Hass Connect met up with Bernard to discuss the impact of the new line and other developments in the industry.What is the current fuel supply status in Kenya and the region? At the start of 2018, the industry had a gasoline deficit but diesel surplus with most shippers reporting insufficient product to meet their demands. To correct this situation more gasoline was imported in the April-May 2018 period. The situation soon changed with the increase of gasoline stockpiles, causing depression of market prices. This situation prevailed from April through May and June. The increase in gasoline imports negatively affected other products, especially diesel. Decrease in Diesel imports caused a strain in most markets within Kenya, Uganda and part of Congo. This precipitated a need to import more diesel through Mombasa especially by the majors who own depots. The seesaw nature of products is not a normal occurrence as this was caused by the outage of three tanks since 2017, affecting all the three grades at Kipevu Oil Storage Facility. The effect of this outage would not have been significant if the discharge rate to Kenya Petroleum Refineries Limited (KPRL) was optimum, as most of the tanks of the later lay idle. The Central Corridor, on the other hand, is oversupplied with all the grades. This is because the Zambian government has not been taking the products they procured through Oil Marketing Companies (OMCs) operating in Dar es Salaam. Also the installation of custody transfer meters from the discharge line caused huge delays in discharges at the port with vessels taking 7-8 days at the SBM and 5-6 days at KOJ. The wholesale market has therefore experienced depression in the recent past.

To secure investor earnings, what developments are underway in terms of importation, loading, storage, supply and distribution of products in Kenya and the region?We are pleased to finally see the commissioning of Line 5 which will enhance KPC’s pipeline devolution plan into the counties by increasing product availability in Nairobi while allowing the existing Line 1 to service Western Kenya. The new pipeline will also improve and stabilize fuel supply to the export markets of Uganda, Rwanda and Eastern Democratic Republic of Congo, which was

estimated to be at 3.5 billion litres by the end of 2016. Ahead of the Line 5 commissioning, a new storage facility of 100,000M3 was constructed to facilitate storage of increased pumping rate from Mombasa. Furthermore, the ongoing Jetty Maintenance And Discharge Facility revamp, at the Coast, promises faster discharges into storage facilities. The automated queuing system within the KPC depot will ensure the product hits the market exactly where it is needed and in good time and minimize manual intervention on queuing of trucks thus better efficiency of loading.

The government recently launched a jetty in Kisumu. What does this mean for the industry?The Kisumu jetty is expected to boost volumes coming through the Port of Mombasa to inland jetties in Uganda & Rwanda. Once this is realized, the freight costs will significantly come down hence, increased transit earnings for Kenya.

What challenges are currently being experienced in the industry? What are we doing to overcome them as Hass and as the industry?We are still prone to challenges such as insufficient ullage and storage, poor discharge infrastructure within KPC and increased demurrage costs.Ideally all companies, and we have aggressively done so at Hass, need to manage inventories to ensure minimal exposure while studying world markets to shield from cost volatility.

What is happening in terms of policy & regulation? Are there any bill changes we should look forward to?The government recently increased tax on kerosene to match that of diesel. This is aimed at discouraging its use and improving the quality of products delivered to customers. They further introduced an anti-adulteration levy, which has reduced consumption of kerosene by 75%. The government, also within the budget 2018/2019, introduced Value Added Tax on fuel sales, this is, unfortunately, being felt by motorists at the pump. What remains now is for ERC to continue monitoring pricing to protect the consumer from resultant increased pricing.

Final comments?The industry is hopeful, however, of increased competitiveness. Companies must contend with prevailing challenges while utilizing industry opportunities. Only then will we build an industry that we can all earn from.


CONSOLIDATING SERVICEWITHIN HASS PETROLEUMGROUPBy Omar SaadGroup Head of Customer Service, Hass Petroleum

Earlier in October, we are celebrated the Customer Service Week. This international celebration aims at recognizing the importance of customer service and of people who serve and support customers daily. The celebration transcends beyond the customer service team because ideally, we are all champions of service in one way or the other. Customer service is a core part of Hass Petroleum Group as ingrained in our company values, alongside integrity and teamwork. I believe business continuity and profitability is anchored on great and robust customer service. The same must continuously be improved as propelled by customers’ ever-changing needs. At Hass, the Customer Service department continues to evolve and take shape as driven by our unique client requirements. When we first instituted Hass Customer Service Centre (HCC), we knew we needed to be independent of the Marketing department and our intentional and flawless interaction with all departments would amplify our business input, while actively and appropriately addressing our customers’ requests. Incidentally, it was around this time that the business decided to institute the Shared Services Model, where customer service and other shared business functions would be housed centrally and availed to all affiliates. Well, the move to consolidate business processes at shared services was a challenge at first, but strategically we knew it would complement all our operations. Having all business units together has meant flawless customer order processing and made follow-up very easy for us. It was a challenging decision to make, but we are now reaping the benefits of this move. With consolidated service centre and in-country customer

service support, we have been able to afford distinguished service to all our customers.Still, we continue to innovate especially to ensure consistency in service as the Hass Petroleum network grows within the region. Consistency is a big word when it comes to customer service, without it confidence is broken. Our goal is to ensure the customer’s experience is maintained from our furthest station in Somalia to our Craa Station in DR Congo. We want our customers to know, that no matter where they find us, it is still us. It is still Hass and you are home.We have developed a Customer Service Charter and a Retail Service Charter which holds both our service promise to our customers as well as guidelines on how the service is delivered by our teams. These tools also help us assess our performance periodically complemented by customer service index monitor. We have also begun the process of implementing a Customer Relations Management tool that will help us manage our customers, requests, compliments and complaints in time and appropriately. Today technology is changing, not so much the principles of customer service but the way in which companies and customers are interacting with each other. Which is why we are talking about installing the CRM system as a useful platform for our customer interaction. Our customer service strategy provides that no matter what platform or channel a customer uses to communicates to us, they will have a response in good time. As we continue to improve and enhance our services, I believe customer relationship building will remain one of our key business inputs.

Haas PetroleumJuja Road


DEDICATED FLEET TO SUPPORTDEMAND RESPONSIVETRANSPORTATIONIn March 2007, Fleet Logistics was incorporated in Kenya as a transport solutions provider for Hass Group. Today, the dedicated service company has grown to include Fleet Kenya serving the Northern Corridor while Fleet Tanzania serves the Southern Corridor. To ensure that we meet customer needs in a timely manner, Fleet Logistics has over 180 specialized petroleum tankers. They cover the entire road transport needs for Hass Group in Kenya, Tanzania, Rwanda, Burundi, Sudan and soon Zambia. They efficiently ferry petroleum products, lubes and LPG. To meet the growing demands for our products in the region, Fleet Logistics has embarked on a major expansion program in the two corridors.Fleet Logistics has a high safety record that assures customers of fuel integrity and reliable delivery. This is enhanced by their advanced tracking and monitoring systems. Additionally, Fleet Logistics is a member of the Kenya Transport Association. The fleet of trucks and products are all adequately insured given the sizeable investment.

Fleet Logistics has over 180 specialized petroleum tankers. They cover the entire road transport needs for Hass Group in Kenya, Tanzania, Rwanda, Burundi, Sudan and soon Zambia.


HASS AVIATION BUSINESSGROWING STEADILYBy Sudhir BishnoiGroup Head of Aviation, Hass Petroleum

In our quest to diversify the commercial business portfolio, Hass Petroleum ventured into the International Aviation business in 2014. Currently, we feature in three countries – Kenya, South Sudan and Somalia. Plans to expand to other countries in the region are underway. Aircraft refuelling operations are already in progress at Juba, Mogadishu, Hargeisa, Nairobi and Mombasa International airports. With the entry of Hass in this business, we have brought with us modern technology, global standards, an international perspective and a high-level of operational safety to some of the airports which had been so far wanting. While our operations in Kenya are now ISO certified, we have achieved global reach with our association with JIG – Joint Inspection Group, UK. We participate in International Quality Inspection Audit by IATA Airlines and have been approved. We have started with our full commitment to standards and quality and have acquired the necessary Refueling Risk Liability Insurance of global magnitude. We participate in the OTS – Open Trade System – system in Kenya to provide fully transparent pricing in Kenya and other transit countries.Hass has built an ocean terminal for all products in Mogadishu. This terminal is for all products in

Mogadishu. It is an important link in providing a stable and secure supply chain to Somalia. We have two Jet A-1 storage tanks with a total capacity of 7000 M3 at the shore terminal for receiving product directly from ships. We have also installed three tanks each of 500,000 litres capacity at the airport depot with the total capacity of 1500 M3 for deliveries to aircraft. We have four specialized vehicles known as Aircraft Refuelers to refuel aircraft of various types at Mogadishu International Airport. Again, our operations in Juba have brought in similar international standards to South Sudan to take this country’s jet fuel operations to new levels. We have future investment plans to expand our reach in both Mogadishu and South Sudan. In Kenya, we refuel some of the prestigious European airlines besides local/regional airlines. These airlines demand international quality and operational standards and Hass is proud to say we meet these requirements. We have a team of dedicated and highly trained staff for the Into-plane jet fuel operations, who come with experience of working with multinational oil companies. Training of staff is a continuing priority at all our locations.


HASS IN TANZANIA:THE GATEWAY TO THE SOUTHERNCORRIDOR

By Abdirahman AhmedCountry Manager, Hass Petroleum - Tanzania.

Its geographical location gives Tanzania the advantage to be the gateway to the landlocked countries such as Malawi, Zambia, DR Congo, Rwanda, Burundi and Uganda. The three operational ports on the Indian Ocean, namely Dar es Salaam, Tanga and Mtwara receive cargoes for both the local market and transit to the neighbouring countries. We have invested in a state-of-the-art storage facility in Dar es Salaam with a holding capacity

of 24 million litres, with a base to hold an additional two tanks which can increase the storage capacity to over 36 million litres. This serves as the nerve of our Southern Corridor activities. Over a period of time, we have been able to partner with key players in the construction and transport sectors, retail, independent outlets and bulk resellers providing them with our quality fuels and lubricants. In Tanzania, we always feel at home and we work smart to transform the economy through our energy solutions. Tanzania’s infrastructure has improved for the last couple of years and all the regions and neighbouring countries are connected with tarmac trunk roads. The country is also investing in the Standard Gauge Railways (SGR) which will give the country the opportunity to deliver more transit cargoes within the shortest time. The improvement of clearance of the goods at Dar es Salaam port and at borders exits has seen more transit goods business growth through Tanzania. The growth of Hass Petroleum – Tanzania has been good within the last two years and we expect more as we continue to increase our presence as the supplier of choice in the growing consumer sectors (mining, manufacturing, constructions & transportation).We envisage to increase our brand visibility by adding more retail stations within the country in the regions with potential growth.

Tanzania’s infrastructure has improved for the last couple of years and all the regions and neighbouring countries are connected with tarmac trunk roads


POLITICAL UNCERTAINTYASIDE, HASS PETROLEUMDR CONGO IS ON THE RISEBy Shukri Ahmed NurCountry Manager, Hass Petroleum - DR Congo

Hass Petroleum is now well established in the Democratic Republic of Congo (DRC) regions neighbouring Uganda and Tanzania i.e. Katanga. Our DRC headquarters are in Lubumbashi, Katanga, where we operate a 2.5 million litres depot. This storage facility, supported by our Dar es Salaam terminal, enables us to service our contractual obligations with major corporate companies in the mining sector and our retail network.With our massive storage capacity, we can hold and replenish our customers stock at the point of consumption. Our key clientele include:• Major mining companies (Glencore Group)• Large-scale construction companies (m-forrest)• The transport sector and independent bulk resellers.The hallmark of the Hass brand in DRC is the consistency of supply, hinged on our central oil terminal in Dar es Salaam that assures product supply to the Katanga region that mainly depends on the extraction of copper and cobalt. Hass DRC’s management style, culture and structure are enhanced in the heart of our mission. They shape the affiliate loyalty in conducting our business in a socially, environmentally and ethically responsible manner.Hass DRC was awarded the best affiliate accolade at the recently completed performance awards for Q3 2018. This was after attaining impressive people management, credit & audit performance as well as sales standing of 8,977 metric cubes per month. DRC’s improving economy, especially propelled by the mining sector, Oman Oil International stake uptake and existence of string supply backbone ensures consistent product availability and price competitiveness. Direct transfer of products to the mines with TZ number plate trucks will offer us an edge against our competitors and allow for the increased market stake and competitiveness for the business in Congo.

Major events driving DRC’s economy now:• Politics: The national election is expected to take

place on December 23rd. This is critical for the future of DRC, a state that has never experienced a peaceful transition of power since it gained independence from Belgium in 1960. The Democratic Republic of the Congo's (DRC) opposition leaders have agreed to meet in Geneva to choose a joint candidate for the

upcoming presidential elections. 21 candidates are set to take part in the presidential election, with voting also taking place for parliamentary and provincial assemblies.

• The economy: Growth in 2017 was estimated at 3.3% due to the good performance of the extractive and manufacturing industries, construction and public works and trade. The recovery is projected to continue into 2018 and 2019 with rising commodity prices and increased activity in the extractive industry as new mining projects start.

• Mining: Copper and cobalt production plays a significant role in DRC’s economy. With the rising global market prices, we expect the good performance of copper production to continue in 2019 which depends heavily on oil products.

• Environmental Consciousness on the rise. There is increasing awareness of environmental matters with laws to protect the environment being enforced in DRC.

• Legal climate. Rule of law is generally respected.

Daddy Konkwe, Admin Manager, Shukri Ahmed, Country Manager, Sarah Kita Accountant Assistant and Christian Bel Air Station Supervisor at Hass DRC staff foru


BULK PRODUCT SUPPLY TO ANCHORRETAIL OPPORTUNITIES IN ZAMBIA

Hass Petroleum has signed a 193,575 M3 fuel supply deal with the Zambian Ministry of Energy for the period 2018-2019.The deal secures fuel supply to the Zambian fuel industry worth an estimated USD 161 million. The same is expected to grow as driven by the country’s mines, construction, agriculture and a robust informal and formal workforce.Issa Sheikh, CEO at Hass Petroleum Group, has described the contract as a demonstration of Hass Petroleum’s growing leadership in oil marketing and supply across Africa.Supplying high-quality petroleum products through innovation, integrity, and reliable service delivery is core to our business. With many years of experience in this field across East and Central Africa, we are confident to fulfil and surpass the expectations within this agreement. This deal not only underscores our agile resourcefulness in extending our services far past our current network

but also demonstrates our zeal to meet our customers wherever they might be.This comes at a time where Hass Petroleum is preparing to open its first retail station in Zambia at the popular Mwananchinchi Highway at Garden Corner. Furthermore, Hass Petroleum has made progressive steps in acquiring six stations from Suban Petroleum (Z) Limited bringing its retail presence to eight by end of 2018.Zambia is continuously improving her fuel exploration, importation, storage and distribution to ensure the delivery of sufficient energy for her growing economy. This has meant entering into partnership with OMCs such as Hass Petroleum to secure quality and best price products.Hass Petroleum was first launched in Zambia in 2006 and has been growing its investments gradually. Hass specialities are expected to be launched in the next year.

By Omar Saad Country Manager, Hass Petroleum - Zambia

Zambia is continuously improving her fuel exploration, importation, storage and distribution to ensure the delivery of sufficient energy for her growing economy.


HASS RWANDA, PROSPECTSRAPIDLY INTEGRATEDEAST & CENTRAL AFRICA

Rwanda, a market of over 10 million people with a rapidly growing middle class, currently imports petroleum products from either the Central or the Northern corridor. The International Monetary Fund (IMF) has retained Rwanda’s economic growth projection for 2018 at 7.2%. Renown as Africa’s Singapore, Rwanda is regarded as one of the continent’s fastest-growing economies supported by its political stability & strong economic policies.Rwanda's energy balance shows that about 85% of its overall primary energy consumption is based on biomass (99% of all households use biomass for cooking), 11% from petroleum products (transport, electricity generation and industrial use) and 4% from hydro sources for electricity.Hass investment in Rwanda is encouraged by the growing construction & transport sectors. The growing middle class has also supported the entry and growth of our speciality products i.e. LPG & lubricants. Today, Hass

Rwanda is listed as one of the leading petroleum marketing companies. The company’s pursuit of an extensive retail presence will match Rwanda’s energy needs now and in the future.Hass continues to service Rwanda’s thriving economy through our major terminal in Dar es Salaam, complemented when necessary by local bulk supplies. Our key clientele includes the local power plant, independent resellers and the transport sector.Hass has also established retail presence in towns of Nyabugogo, Gikondo and Gisenyi. The Rwanda office has become our springboard to the regional markets of Burundi and North and South Kivu markets of DR Congo.

By Liban OmarCountry Manager, Hass Petroleum - Rwanda

Rwanda is listed as one of the leading petroleum marketing companies. The company’s pursuit of an extensive retail presence will match Rwanda’s energy needs now and in the future.


HASS IN SOUTH SUDAN

Oil is still South Sudan’s biggest export and foreign exchange earner. Following the Khartoum peace deal signed July this year by the opposing factions, investor return is now tenable. Energy is expected to spur the envisioned economic revival in this oil-rich region.The untapped potential is what attracted Hass to this region in early 2005. Our one million litres installed capacity depot in Juba, South Sudan caters for the local consumption. It enables us to operate our network of stations spread across Juba city and the urban towns of Torit, Kapoeta, Yei, Yambio as well as Hass branded dealer stations. Hass has also attracted a wide range of consumer clientele from the NGOs, as well as privately owned corporations.We service customers in major sectors such as construction, power, transport, international agencies and motorists through our retail stations. Hass South Sudan was the pioneering indigenous East African Oil Marketing Company to launch retail stations. The stations incorporated an innovative concept of container service to meet the growing demand for the country as it sought independence.

To enhance lubes and LPG sales, we have opened two shops in two different, strategic locations within Juba. One is in Juba town and the other in Kakuma. Kakuma is the transport hub for the long-distance trucks; hence the move to take our lubricant shop right to their doorstep resulting in increased volume sales.

Strategically, we have extended our opening hours to 9 pm, a first in South Sudan where night operations are still uncommon. The vision is to equip the business with enough capacity for a 24-hour service.

We are optimistic that the signing of the peace deal and resuming of crude oil production will help in reviving the petroleum sector in South Sudan. To complement the thriving economy as well as take up new energy opportunities in South Sudan, Hass will be extending its investment in the region particularly in retail expansion as well as bulk imports.

To enhance lubes and LPG sales, we have opened two shops in two different, strategic locations within Juba. One is in Juba town and the other in Kakuma.

By Ahmed Kalmey Country Manager, Hass Petroleum - South Sudan


HASS IN UGANDA:THE PEARL OF AFRICA

The petroleum industry in Uganda has reached maturity, growing at 7% p.a. The market size has grown from 1,300,361m3 in 2012 to 1,805,506 m3 in 2017 largely due to increased demand for gas and oil in both retail and commercial sectors. Sustained investment in infrastructure development has also significantly contributed to this this growth. However, the industry’s low entry barriers have led to an influx of competitors, both foreign and local leading increased competition amidst high customer expectations. What sets us apart is our focus on customers – not competitors. We have sustained superior customer value through: Quality Management and customer service excellence as driven by our customer service charter.Our ambitious expansion plan has provided unprecedented opportunities to expand our reach into new geographical territories thus creating a sustainable distribution channel for customers to access our products country-wide. Our network has grown from 17 gas stations in 2017 to 24 stations in 2018. Our core focus for the future is creating demand-led growth to leverage our distribution, storage and logistical assets.The competitive and macro business landscape continues to pose threats both in commercial and B2C segments coupled with forex volatility. We are focused on improving

our top-line by differentiating our offerings to enhance our brand reputation and perceived value of our products. This will allow us to charge price premiums that will deliver sustainable profitability amidst increased customer loyalty.Our expansion plan is based on prevailing market attractiveness and stable business environment. We have operationalized 7 sites in Koboko, Arua 2, Kamengo, Mubende, Busia, Njeru, and Wakiso respectively in 2018. Our 2019 expansion plan includes Busega 2, Mityana, Arua 3, Lira, Bungokho, Gulu, Bweyale, and a minimum of 3 dealer stations. This will increase our network to 46 by December 2019. Our goal is to defend our competitive position and penetrate attractive segments through Customer Service excellence and enhanced customer experience. This will be achieved through the introduction of Fuel Cards in the later part of 2019 and our domination of the attractive ‘Boda Boda’ segment. We shall invest in market research to have a deep understanding of our ever changing customer needs, industry trends and market forces that could pause uncertainty to the business. We have earmarked resources to support customer satisfaction surveys at customer touchpoints

By Partha GhoshCountry Manager, Hass Petroleum - Uganda.


HASS PETROLEUM INVESTINGIN COMMUNITIESThe importance of giving back and improving the lives of others is at the core of Hass Petroleum’s foundational mission – hence, the birth of the Hass Petroleum Charitable Trust. The foundation was first launched in July 2007 with its offices at Hass Plaza, Lower Hill Road, Nairobi. The mission of the foundation is to create, find and support programs that directly improve the wellbeing of communities through health, education and special projects. HPCT strives to ensure that all children have the opportunity to reach their full potential. Our strategies address fundamental needs related to education that must be met for children to thrive. We work with local authorities to help schools deliver better educational outcomes and promote healthy behaviour among children and their families. The Trust is committed to increasing access to high-quality primary care and reducing health care disparities for the communities. Furthermore, the foundation partners with private and governmental institutions to deliver special projects within our focus areas.

Hass Petroleum Charitable Trust runs the following institutions:• Tayyiba Medical Centre: A health institution in

Kisumu• Tayyiba Orphanage in Kisumu.• Al Muminun Academy: A primary school Kisumu.• Railway Mosque – Kisumu.• Darul Ilmi Academy: A school in Nakuru.• Nakuru Tahfith (Quran memorization) Centre.

Other partner institutions:• Kericho Muslim Association.• Al Mustaqbal Education Trust.• Madarasa Rahma – Sarif Wajir.• Merti Holy Quran – Isiolo.• Markazul Hidaya – Nairobi.

• Teso Islamic Centre.• Fees scholarship to deserving needy students. • Rahma Mosque Self Help Group- Nakuru.• Madarasatu Abibakar Management Committee-

Hagarder.• Al-Bukhari Intergrated & D a’waa Organization-Wajir.• Qimah Daawa Group- Wajir.• Tana North Muslim Organization.• Tana River Education & Daawa Organization.• Chalbi Muslim Primary School- Marsabit.• Eltabash Educational Trust- Mandera.

It is envisaged that Hass Petroleum Group will continue to support HPCT programs as part of its Corporate Social Responsibility efforts.

Tayyiba Medical clinic

Hass team during the Stanchart Marathon

Haas Connect 2018

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