Let’s protect KPC from political intrigues

The KPC is a critically important national asset. FILE PHOTO | NMG 

The Kenya Pipeline Company (KPC) is in the market looking for a new managing director. Expect to see all manner of political intrigues and games by forces trying to influence the appointment of a new chief of this critically important national asset.

Over the years, the political elite have turned the company into a stage where competing interests test their mettle. When appointment of a new CEO is on the cards as is the case right now, the stakes go a notch higher even as the intrigues intensify.

This time around, the recruitment of a managing director for the State-owned company is coming against the backdrop of major political undercurrents. The former managing director, Mr Joe Sang, and key members of the company’s executive committee left office in December even as they faced criminal prosecutions.

There was a point when the biggest issue around the company was a forensic audit on its stock that was being demanded by oil companies. As it turned out, the results of this audit were anticlimactic.

Last month, there were reports that the Directorate of Criminal Investigations (DCI) had commenced investigations into the siphoning of oil from the pipeline. There were recent reports that the DCI had moved to conduct investigations on payment of certificates to a politically-influential contractor.


In the mix of it all, a parliamentary committee on energy joined the fray, ostensibly to conduct a probe into the financial affairs of the company. But observers interpret all these shenanigans as part of games and intrigues to influence the appointment of a new managing director.

This week, the CEO of the Energy and Petroleum Regulatory Authority (EPRA), Pavel Oimeke, appeared before the committee where he blamed the company for all manner of ills - including for charging non-competitive tariffs to pipeline users.

Mr Oimeke argued that the non- competitive pipeline tariffs had made road transport cheaper and forced oil companies to prefer trucking through roads even as the government continues to pump billions of shilling into building pipelines.

There was a sense of hypocrisy in Mr Oimeke’s remarks because as CEO of EPRA, he is the final authority on pipeline tariffs. Thus, he is part of the problem of the high pipeline tariffs he was fulminating about before the committee.

Against this background, it did not surprise that his performance before the committee was widely viewed as part of the political intrigues and efforts to lend support to the competing interests that are currently involved in the fight to influence the appointment of a new managing director. By the way, Mr Oimeke’s tenure as CEO of EPRA will also be coming up for review in the next six months.

In the game of political patronage, it does not matter how critically important a State corporation is to the functioning of the economy. The KPC is a critically important national asset. It is the umbilical cord of the oil marketing industry in East Africa.

Yet its management and corporate governance is always the subject of parochial intrigues and games where facts do not matter at all.

I say so because as you peruse the company’s latest audited accounts, KPC has built very big cash reserves in its books. The top line reflects growth and profits are up.

Clearly, the State-owned company is on an impressive trajectory in terms of financial performance. Yet in the world where patronage politics is what counts, performance and merit do not matter when it comes to assessing the company.

Careers of managing directors at KPC go up and down depending on the balance of political power in the energy and petroleum sector.

Even in the current circumstances, it is the wielders of power in this sector who will ultimately have their way. I still remember the circumstances under which former managing director Selest Kilinda was booted out of office following shifts in the balance of power in the energy sector.

He was sent on leave on the excuse that he needed to exit to pave the way for a comprehensive investigation on claims of nepotism in recruitment. As it was to turn out, that audit revealed that Kilinda’s tribesmen- the Taita- were far outnumbered by the Kalenjin and Kikuyus in the company’s workforce. But they hanged him on the spurious claim that he had employed his sibling as a welder.

We need to insulate this critically important national asset from these unending games.