NAIROBI: The construction of the 20 inch Nairobi to Mombasa in Kenya oil pipeline will be completed by end of December 2016, officials have said.
Permanent Secretary in the Ministry of Energy and Petroleum Joseph Njoroge told Xinhua in Nairobi that the 485 million U.S. dollar pipeline will reduce the cost transporting fuel from the port of Mombasa to Nairobi by almost half.
“Construction has already begun for the pipeline that will use modern technology to transport petroleum in comparison with the existing pipeline which was built in 1973,” Njoroge said during the launch of new lubricants by Oilibya.
Kenya Pipeline Corporation (KPC) awarded the contract to construct the facility to Lebanese firm Zakhem International, which also built the existing pipeline.
Njoroge said the new pipeline will help reduce the use of trucks for transporting fuel products. “The trucks cause a lot of damage on the roads,” he said.
The pipeline is funded by a consortium of local banks and the loan is supported by KPC’s balance sheet. Uganda, South Sudan and Rwanda rely on the pipeline for the importation of fuel for their domestic needs.
The PS said the pipeline could be extended into neighboring countries depending on the demand. The pipeline is in addition to the crude oil pipeline that will construct to link Uganda and South Sudan to the Lamu port. The East African nation also plans to construct a 144,000 cubic meter storage capacity in Nairobi.
“This will ensure that the country has sufficient supply of refined petroleum products by enhancing the volume of fuel that can be imported into the country,” he stated.
Oilibya General Manager Duncan Murashiki said that haulage constraints continue to be the main challenge impacting negatively on petroleum sector. Murashiki added that his firm is committed towards fostering innovation and producing sustainable energy solutions.
