The recent commissioning of the Sinendet-Kisumu pipeline has enhanced road safety in the Western region by removing about 240 trucks from the road daily.
The pipeline has also eliminated fuel fires and siphonings on our roads, hence saving lives and conserving our environment.
The Sinendet-Kisumu pipeline is a Sh5.7 billion 122km 10-inch diameter pipeline, parallel to an existing 6-inch diameter pipeline from Sinendet to Kisumu, designed to enhance petroleum product availability in Western Kenya and the export market — Uganda, Eastern DRC, Rwanda, Burundi, and northern Tanzania.
The recent tragedy involving a Canter truck that killed 43 people near Naivasha town brought to the fore the role of the Kenya Pipeline Company in the safe transportation of petroleum products.
In the Naivasha tragedy, the material ferried by the Canter was not a petroleum product as alleged in a recent media article.
As the relevant authorities investigate the accident, to ascertain its root cause, identify the highly flammable material and why the truck was not on the Mai-Mahiu route as required by law, one cannot make any assumptions as yet.
In today’s oil and gas landscape, KPC plays a key role in the oil and gas downstream part of the supply chain. The main objective of KPC is to provide efficient, reliable, safe and cost-effective means of transporting petroleum products from Mombasa to the hinterland. In pursuit of this objective, the company operates a pipeline network, storage and loading facilities for transportation and distribution of petroleum products. It is the only one of its kind, in all of East and Central Africa charged with the safe transportation of petroleum products.
The current KPC pipeline capacity is sufficient for transporting 90 per cent of the total imported petroleum product volume, which means approximately 10 per cent is transported by road. KPC is in the midst of an ambitious endeavour to have all the fuel is transported by pipeline with the completion of a new pipeline from Mombasa to Nairobi — to be commissioned in 2017 — and the recent acquisition of Kenya Petroleum Refineries Limited, which will more than double the storage capacity.
It is a well-known fact that pipeline transportation of fuel is the safest and most cost-effective the world over. The notion that transportation of petroleum products by road in the region is cheaper than through the pipeline is a complete fallacy. The reason for this recent argument, even from some oil marketers themselves, is because they simply are not accounting for the total cost of using tankers on our roads.
One key ingredient in the cost of road transport that is consistently left out of the equation is
demurrage. Demurrage is a maritime term used for the cost of delaying a ship at the port once they have given their notice of readiness to discharge. This cost is extremely high in the order of Sh25 to 35 million per day. The delay is incurred at the Shimanzi Oil Terminal used mainly for the discharge of private cargoes into the oil marketer’s private depots in Mombasa. This is because SOT has a much lower discharge capacity in handling the petroleum vessels.
The cost to Kenyans is even greater, as the heavy tankers contribute greatly to the accelerated dilapidation of our roads, which necessitates the road levy of Sh18 per litre at the pump. KPC is committed to addressing this question.
One cannot put a price on the safety and lives of the public. On the other hand, the government remains very careful and cognizant of the need for KPC to remain cost-efficient, which is clearly evident from the fact that the pipeline tariff has been reviewed only once in the last 15 years. There are also no extra levies or taxes associated with pipeline transportation.