Kenya Pipeline to spend Sh17bn on cooking gas storage facility
Major cooking gas dealers have a price difference of up to Sh500 for the 13-kilogramme cylinder, highlighting the deep margins some players have put on the commodity. FILE PHOTO | POOL
The Kenya Pipeline Company is expected to spend Sh17.7 billion towards the construction of a cooking gas handling and storage facility in Changamwe, Mombasa.
The State corporation has made the disclosure in an environmental impact assessment report that represents a preliminary estimate of the total project cost before the front-end engineering design process.
"The proponent has undertaken a preliminary estimate of the total project cost using experienced consultants. The project is estimated to cost the proponent Kshs. 17,731,000,000 (Seventeen Billion Seven Hundred and Thirty-One Million) to implement," reads part of the report filed by the National Environment Management Authority (Nema).
KPC has engaged both R&E Modern Technologies and Pakistan-based Petrochem Engineering Services as consultants in the project.
The project will involve the installation of a new LPG facility of 30,000 metric tonnes which will primarily receive LPG from ships berthed at the Kipevu Oil Terminal jetty.
The project’s long-term goal is to increase the adoption of clean cooking fuels by households to 42 percent by 2030.
“Growth in LPG consumption in Kenya has been on the rise demonstrating an exponential trend.
However, the country needs to urgently adopt new strategies to ensure that the target goal of 15 kilogrammes per capita is not missed by 2030,” KPC notes in the project notes.
The handling and storage facility will be an upgrade to the current LPG importation, storage and distribution infrastructure which is aimed at ensuring a robust supply chain and reduced landing costs from economies of scale and elimination of monopolies.
Kenya’s current LPG storage capacity will rise from the current 37,470 metric tonnes represented by a storage facility at the Kenya Petroleum Refineries Limited to 67,470 metric tons.
The project is expected to generate job opportunities for both skilled and unskilled labour.
KPC further anticipates trickledown effects resulting from the employment opportunities and services provided by the facility.
“It is anticipated that the proposed project will provide opportunities for local employment and service provision, such as the use of local transport companies and sourcing of some construction materials locally,” it added.
The facility is expected to quicken the loading of LPG for distribution.
