First Uganda oil import lands at Mombasa in July
Two tankers carrying the first consignment of petroleum products directly imported by Uganda will dock at the Mombasa port next week.
Two tankers carrying the maiden consignment of petroleum products directly imported by Uganda will dock at the Mombasa port next week, marking an end to the monopoly long enjoyed by Kenya oil marketers.
The imports are part of a negotiated deal between Uganda National Oil Company (Unoc) and Vitol Bahrain that targets to lower pump prices below the current rates offered by dealers in Kenya.
UNOC Chief Corporate Affairs Officer Tony Otoa said two vessels will dock in Mombasa on July 2.
“We expect the first vessel carrying 70,000 tonnes and this will continue to ensure stability in fuel supply to the country,” he said. The Uganda shipment will be delivered through the Kipevu Oil Terminal 2 (KOT2) and use Kenya Pipeline Company (KPC) facilities to transport it to Uganda.
On Friday, Unon, Kenya Ports Authority (KPA), and Kenya Revenue Authority (KRA) among other stakeholders held a final meeting in Mombasa before arrival of the two vessels.
But while Unoc’s entry into Kenya as a direct importer will hurt local oil firms, KPC will not suffer any revenue losses, given that the Ugandan company will continue using its storage facilities and transport network to ship the fuel to the neighbouring country.
This is a win-win agreement between Kenya and Uganda with KPA pledging to offer efficient services to cut the cost of handling fuel. KPA managing director William Ruto said the deal is part of the plan to increase fuel throughput to Uganda.
“It’s true Uganda is bringing their own vessel. This has been made possible and easy because we can handle up to four vessels at any given time,” he said.
KPA boasts the Sh42 billion KOT2 which consists of four berths with a total length of 770 metres and a workboat wharf at Westmont for landing facilities. The terminal can accommodate three ships concurrently, each with a capacity of 200,000 tonnes. The facility has five sub-sea pipelines and six onshore pipelines connecting the terminal to the Kenya Petroleum Refineries Limited and the KPC's storage tanks.
The KOT 2 terminal can handle six different hydrocarbon import and export products, including aviation fuel, diesel, and petrol, and will be fitted with a Liquid Petroleum Gas facility, crude oil, and heavy fuel oil.
Kenya has proved capable of handling huge volumes of petroleum products with KPC having 45 tanks with a total storage capacity of 484 million litres out of which 254 million litres are reserved for refined products.
According to the sale and purchase agreement obtained by this publication, Uganda chose Kenya over Tanzania due to its investment at the port and its proximity to the country.
