WHY AMERICAN SAMOA STILL HAS LOW PRICES AT LOCAL GAS PUMPS

admin's picture

By La Poasa

PAGO PAGO, American Samoa (July 16, 2000 - Samoa News/PINA Nius Online)---While residents in some U.S. states are complaining about rising gas prices this summer, American Samoa is not affected by this problem yet.

At present, local gas pumps are selling gas at between $1.40 to $1.60 a gallon while, for example, Tonga residents are paying US$ 3.55/gal and Samoans in the Independent State are paying US$ 3.27/gal.

In states like Chicago, New York and Illinois, residents reportedly are paying more than $2 per gallon for unleaded gasoline.

"We've always had the benefit of consistently having low prices on gas over a period of time," explains American Samoa Petroleum Officer Sione Rotorua Lousiale Kava.

One contributing factor is that American Samoa is about the only territory or island nation in the South Pacific in which the fuel tank farm is owned by the local government.

"This is the biggest benefit to us because there are a lot of problems all over the Pacific Islands with oil companies owning the tank farms, but we are fortunate it is set this way," stated Kava.

Kava said he got a call from the Hawai‘i Governor's Office asking why the territory is able to maintain low prices while the mainland gas prices have doubled over the local prices.

Kava explained that the local government is able to work out negotiated prices with the two oil companies in the Territory, British Petroleum (BP) and Mobil, to come up with a Maximum Allowable Price (MAP). The two oil companies cannot sell above the MAP.

After the MAP is set, local gas stations add in their own costs and the product price is the amount local residents pay at the pumps.

Another factor in keeping the prices down, Kava added, is the willingness of the Office of Petroleum Management to work hand-in-hand with the oil companies to manage what goes on at the tank farm.

The Office of Petroleum Management's mission is to assure that American Samoa has an unlimited supply of high quality fuel at the most competitive price and to make sure that the local tank farm facilities comply with all EPA regulations.

The Petroleum Officer stated that American Samoa and most Pacific Islands get their fuel from Singapore and Australia. The transportation fees, onshore costs and government's fixed fees, rents and taxes are added onto the base price.

"Every country has different transportation fees, onshore costs and government taxes, which are the factors of the different prices in each area," said Kava.

He added that the distribution prices are different in each country and basically American Samoa has lower transportation prices, government fees, supplier costs, transportation prices and a low base price.

Kava said the fees are used to help build and maintain the tank farms while the taxes collected are used for something else other than for the facilities.

According to Kava, the local tank farm can hold 230,000 barrels of diesel products. He said that 75 percent of fuel for the territory is diesel and 75 percent of the diesel goes out to the fishing fleets.

Items from the SAMOA NEWS, American Samoa's daily newspaper, may not be republished without permission. To contact the publisher, send e-mail to

Pacific Islands News Association (PINA) Website: http://www.pinanius.org 

Rate this article: 
No votes yet

Add new comment