Market News

Firms invited to inspect Sh3bn six-kilo gas cylinders

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A man walks past cooking gas cylinders displayed for sale in Ukunda, Kwale County. FILE PHOTO | NMG

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Summary

  • The winner is expected to inspect all cylinders procured by the State-owned National Oil Corporation of Kenya (Nock) and will be contracted to affirm quality and safety standards.
  • Tender documents say bidders must have a fully equipped and accredited workshop where a report on every serialised cylinder will be submitted to Nock for safe custody.
  • National Treasury has allocated Sh3 billion for purchase of the cylinders to be sold at a subsidised Sh2,000 rate under the Gas Yetu brand.

Private inspection firms have been invited to tender for monitoring the safety of the six-kilogramme Gas Yetu cylinders as the State prepares to kick-start the stalled Sh3 billion project.

The State Department for Petroleum tender expires Tuesday.

The winner is expected to inspect all cylinders procured by the State-owned National Oil Corporation of Kenya (Nock) and will be contracted to affirm quality and safety standards.

“Due to growing use of Liquefied Petroleum Gas (LPG) cylinders under the Mwananchi Gas Yetu Project, any compromise on quality may result in far reaching ramifications whose containment may be costly or irreversible. It is essential that we have an independent third party service provider to test the cylinders so as to control/ mitigate unwanted incidents,” it said.

Tender documents say bidders must have a fully equipped and accredited workshop where a report on every serialised cylinder will be submitted to Nock for safe custody.

National Treasury has allocated Sh3 billion for purchase of the cylinders to be sold at a subsidised Sh2,000 rate under the Gas Yetu brand.

This is about 150 percent lower than the market cost of similar cylinder with cooking accessories which goes for about Sh5,000 while refilling of empty 6-kilogramme LPG cylinders had earlier been set at Sh840.

The development comes after the High Court blocked release of an initial 300,000 gas cylinders procured two years ago under the Mwananchi Gas Yetu project for public use after they were found to be faulty.

LPG use has continued to grow for the third year running following imposition of a logging moratorium resulting in importation of 234,400 tonnes of LPG imported in the first nine months of 2019.

This was 27.5 percent or 50,601 tonnes more compared to a similar period in 2018, where the government targets to increase LPG consumption from a paltry two kilogrammes to between 10 kilogrammes and 15 kilogrammes per person.