Ideas & Debate

Petroleum projects will bridge national, regional economies

Kenya will meet the demands of a fast growing region. FILE PHOTO | NMG
Kenya will meet the demands of a fast growing region. FILE PHOTO | NMG 

The government, through the Kenya Pipeline Company (KPC), is currently undertaking a number of essential petroleum infrastructure projects to enhance the availability of fuel in Kenya and neighbouring countries. These include replacement of pipelines, enhancement of storage capacity and investment in loading facilities.

Banking on sufficient and efficient infrastructure systems, Kenya is assured of adequate and reliable supply of petroleum products across the region.

It is important to point out that increase in local and regional demand for petroleum products has in recent years not been matched by the development of requisite infrastructure to meet supply chain and market requirements.

This is the strategic gap that the KPC seeks to bridge to fuel the national and regional economies.

Regional demand for refined petroleum has increased to 13 per cent of Kenya’s total exports, making it the country’s third largest export product after tea and cut flowers.

Last year alone, Kenya exported about two billion litres of refined petroleum to the five East African countries and the Democratic Republic of Congo. Uganda leads the pack having imported products worth over Sh1 billion last year.

Completion of the pipeline from Sinendet to Kisumu (Line 6) in 2016 has already boosted product availability in Western Kenya and the export market of Uganda, Eastern DRC, Rwanda, Burundi and northern Tanzania.

In addition, the installation of more loading facilities to cope with the rising demand at KPC Eldoret depot, which serves the region and neighbouring countries, is complete and the new facility is expected to enhance the country’s fuel exports in the medium to long-term.

Since the new truck loading facility became operational in July, evacuation of products in Eldoret has increased from four million litres per day to a massive 6.5 million litres per day.

This has increased efficiency of service delivery at the depot while maximising the full benefits of the Nairobi-Eldoret pipelines.

Because of this intervention, there will be no need for trucks to drive all the way to Nairobi to fetch fuel thus unnecessarily increasing local pump prices.

The ongoing construction of the Kisumu Oil Jetty on the shores of Lake Victoria, set to be completed by end of the year, will go a long way towards boosting fuel exports to East Africa through Uganda and Tanzania.

The jetty is expected to boost throughput in Kisumu by one billion litres a year in phase 1 and up to three billion litres per year by 2028. With such volumes, the project has the potential to turn Kisumu into a focal point of oil and gas commerce in the region making it one of the busiest inland ports in Africa.

The above projects have been ongoing in tandem with the Sh48 billion new Mombasa-Nairobi oil pipeline project (Line 5), the country’s second largest infrastructure undertaking, which is now in the final phase of development and will be ready for commissioning by the end of the year.

The completion raises hope of lower road maintenance costs given the hundreds of trucks the new line will remove from the country’s roads.

The new line will see installation of four new pump stations in Changamwe, Maungu, Mtito Andei and Sultan Hamud and two booster pumps in Kipevu, all complete with new fire fighting systems together with other energy equipment and pipeline monitoring technologies for efficiency and safety in fuel supply logistics.

With the near completion of Line 5, there is need for enhanced operational flexibility in Nairobi given the higher volumes of fuel that will be pumped upstream.

In line with this, the KPC has erected four additional tanks in Nairobi terminal to provide sufficient capacity for receipt of higher volumes of diesel, super petrol and jet fuel products once the new line is operationalised.

The commissioning of these tanks is also expected before end of this year.

By broadly investing in these infrastructure projects that improve how fuel gets to our customers and consumers, the country has the opportunity to bolster regional business ties with the neighbouring countries as we strive to transform the lives of our people.

Joe Sang is Managing Director, Kenya Pipeline Company; [email protected]