Nock seeks Sh21.9b for oil storage terminal, jetty
Posted Tuesday, June 26 2012 at 13:43
The National Oil Corporation of Kenya is seeking a strategic partner to help raise Sh21.9 billion ($260 million) to construct an offshore loading and offloading jetty and a modern storage terminal in Mombasa.
The firm’s managing director Sumayya Hassan-Athmani said construction of the facilities with a capacity to handle very large crude carriers of up to 300,000 metric tonnes and bulk storage tanks of a similar volume will be undertaken under a public–private partnership model.
“This project will de-bottleneck the petroleum fuel supply chain and help safeguard against supply shocks,” said Ms Athmani.
NOCK is undertaking the project in a bid to improve supply of petroleum products to the region. The landing platform will be built about five kilometres into the sea and will be connected to a depot to be situated at the Kipevu Oil terminal in Mombasa.
Spanish firm Alatec Consulting is currently undertaking financial and technical feasibility studies on the project at a cost of Sh716 million ($8.5 million) and is expected to finalise its report by the end of this month.
The state-owned fuel retailer did not disclose the exact amount it will be seeking but said it had opted to finance the venture in partnership with the private sector companies because it is unable to fully self-finance the project.
“We cannot raise that amount of money ourselves, we will seek either a public-private or public-public partnership,” the firm announced.
The system of packing and unpacking fuel products on sea is referred to as single-buoy mooring and allows the handling any size of ship.
The announcement comes at a time when the Treasury is working to fast-track the Public Private Partnership Bill that will help unlock funds from the private sector to fund infrastructure undertakings.
“With the new Private-Public Partnerships legislation that will be shortly introduced before this house, private sector participation in provision of infrastructure will increase,” said Finance minister Njeru Githae in his Budget Statement for the 2012/2013 fiscal year.
Further, the state oil corporation plans to set up strategic petroleum reserves spread all over the country with a capacity to last the country 90 days at a cost of Sh126.4 billion ($1.5 billion) under a similar PPP framework.
The depots will have a total capacity of about 1 billion litres, to meet the ever increasing demand for petroleum which peaked to 3.97 billion litres last year according to data from the Ministry of Energy.
The firm is banking on the project whose feasibility studies are currently on-going to help meet its mandate of providing stability in the local fuel markets and ensuring security of supply.