advertisement

Corporate

North Rift bloc pushes for regional oil refinery

A Tullow Oil exploration rig in Turkana: A refinery requires a central location, experts have said.  FILE PHOTO | NMG
A Tullow Oil exploration rig in Turkana: A refinery requires a central location, experts have said. FILE PHOTO | NMG 

A North Rift trade caucus has opened a lobbying front to have crude oil from Turkana refined in the region, targeting jobs among other benefits.

Eight counties under North Rift Economic Bloc (Noreb) is proposing to the Kenya Pipeline Company (KPC) that the refining of crude from Turkana and Kerio Valley be done in the region.

Tullow Oil has found deposits in Turkana, Elgeyo Marakwet and Kerio Valley belt bordering Baringo.

Speaking during a meeting with KPC officials in Eldoret on Thursday, Jackson Mandago, the Uasin Gishu governor, said the facility should be set up within the region producing the black gold.

“Kenya Pipeline should set up the refinery in any of the Noreb counties. It does not make sense that the crude oil is transported all the way to Mombasa yet the processing can be done in the region where the oil is extracted,” he said.

Experts, however, say that the location of an oil refinery is chiefly defined by ease of distribution. “The refinery location may favour Isiolo,” said George Wachira, the director of Petroleum Focus Consultants, because it is “central for both crude oil  refinery input and distribution of products to  all directions of the country.”

The government has in the past mulled setting up the refinery in Lamu port, a location experts say may not be favourable in terms of costs.

“Lamu location would imply double transportation and cost  — crude oil to Lamu and backhauling  products back to the main centres of demand,” said Mr Wachira.

“However, the main issue is whether Kenya, in the short to medium term, requires a refinery. The quantities of oil discovered so  far  cannot justify both an export pipeline and a refinery .”

Kenya Pipeline had visited the governor’s office as they move to launch the Eldoret Oil Gas City, a blueprint that also seeks to establish an oil and gas college branch in Eldoret.

The oil and gas institute is headquatered in Morendat, in Naivasha. “Eldoret is well positioned. The issue of establishing a refinery in Noreb, we take it as a message,” KPC’s director of Morendat Oil and Gas Institute, Dr Yonah Aiyabei said.

advertisement