WE INVESTIGATED: What are the oil reserves of the Federation, paid for by citizens?

Citizens of the Federation pay one fening per liter of fuel, which should be set aside for oil derivative reserves in the Federation. This law has been in effect for almost three years, since August 2014. In 2016, around nine million KM were collected from citizens in this way, confirmed by the FBiH Government.

The Federation of Bosnia and Herzegovina, however, still has very modest oil reserves. Stocks in the Federal Commodity Reserves are negligible, and the Operator of the Federation Terminals has not yet managed to make all storage capacities operational, writes the Patria News Agency.

In accordance with international provisions, mandatory reserves for a country are established as 61-day consumption of oil and oil derivatives, or as an average 90-day net import, whichever quantity is greater.
Taking into account the parameters of 61-day consumption of oil and oil derivatives in the Federation, this BiH entity should have about 204,000,000 liters of oil derivatives in reserve.

Does the Federation have these quantities?

The Federation of BiH Terminals explain for Patria that although the aforementioned law has been in effect since August 2014 (citizens have been paying the reserve tax since August 2014, op.a.), the Operator only achieved significant inflows of funds during 2016, due to delays in adopting bylaws.

- The Law on Oil Derivatives in FBiH established the company 'Operator – Terminals of the Federation' Ltd. Sarajevo, which was established as the sole authority responsible for establishing oil derivative reserves in FBiH.

For the establishment of oil derivative reserves, the Law also stipulates the payment of a tax in the amount of 0.01 KM per liter of fuel.

Related article: Due to a ministry error, oil derivative distributors from FBiH pay more VAT into the state treasury

For each year, the FBiH Government passes a special Decision on the dedicated use of the tax on oil derivatives, which prescribes the ratios for the use of collected funds for investments in terminal rehabilitation, for the procurement and security of oil derivatives, and for the Operator's operating costs.

The Operator has been assigned the liquid fuel terminals in Blažuj, Bihać, Mostar, and Živinice for use and management, with a total capacity of 117,000 cubic meters, but due to various destructions, equipment obsolescence, and the consequences of the 2014 floods, none of the terminals were in usable condition, nor were they registered 1/1 to the Federation of BiH.

In the past period, the Operator has initiated registration activities, and two terminals (Bihać and Živinice) have already been registered to the Federation, while the registration of other terminals is expected in 2017.

Also, the Operator has undertaken a series of technical, legal, and other activities with the aim of starting the establishment of oil derivative reserves in FBiH.

In this way, the Operator will be enabled to respond to the European Commission's Directive, which prescribes the Mandatory oil and oil derivative stocks that every country must have before becoming an EU member.

The Terminals explain that in addition to the existing ones, the Operator in FBiH will need an additional approximately 170,000 cubic meters of storage space. Therefore, they have designed an increase in the current capacities at the Živinice terminal, and the devastated military terminals in Misoči near Ilijaš, Pokoj in Bihać, and Pajtov han near Vareš, which have also been assigned to the Operator, will need to be renovated.