OIL SYNDICATE

KPC links 'insiders' to oil siphoning scandal

Police have since made 10 arrests in connection to the scam among them one person who operated petrol stations in Ruiru and Kiambu.

In Summary

Two senior KPC security staff have been suspended while the services of a private security firm charged with securing the line terminated.

Zakhem International Construction Limited hired welders from Nigeria and India in the construction of the Sh48 billion Mombasa-Nairobi pipeline.

A crane loads pipes onto a truck to be used in the construction of Mombasa – Nairobi oil pipeline. /FILE
A crane loads pipes onto a truck to be used in the construction of Mombasa – Nairobi oil pipeline. /FILE

Kenya Pipeline Company(KPC) has described the siphoning of petroleum products on the new Sh48 billion Mombasa-Nairobi pipeline as an 'expert' job, putting its staff and contractor on the spot.

In a new twist of events, KPC management has further added that the Mlolongo siphoning incident was planned, where valves used in the siphoning are suspected to have been fixed during construction.

This now places the contractor- Zakhem International Construction Limited on a tight spot even as it emerged that the company hired welders from Nigeria and India as part of its labour force in the construction of the 450-km, 14-inch-wide pipeline, which apart from the siphoning incidents, it leaked less than a year into operation.

DCI officers uncovered the infamous  siphoning syndicate on June 26, where a 20-meter long hose pipe had been connected into the new pipeline(Line5) via two valves-a ball valve and a gate valve-which controlled the flow from the main line into a parked truck labeled “clean water”.

The site had an iron sheet perimeter fence disguised as a construction site, according to KPC and DCI.

The flexible hose extended out from the tunnel to the point on the surface where it was used to load the truck with petroleum product,” KPC acting managing director Hudson Andambi said yesterday.

You will not expect somebody to go and drill into the pipeline when the products are flowing unless he had the capacity to stop the flow and do other technical maneuvers. We suspect this was done during the construction time,"Adhambi said.

Line 5 has a flow rate of 950 cubic metres per hour, with an average pressure rate of 95 bars to 100 bars. The average pressure in a saloon car tyre is 2.1 bars, meaning the pressure in the pipeline is close to 50 times that in a tyre.

 "Somebody market the area and knew this is where my valves are and he would just come and dig a tunnel and connect,” Adhambi told journalists at KPC headquarters.

Police have since made 10 arrests in connection to the scam among them one person who operated petrol stations in Ruiru and Kiambu where the products were being delivered.

DCI has also arrested an unnamed individual said to have been receiving proceeds from the illicit transactions and the alleged owner of the piece of land in Mlolongo. A suspected coordinator of the scheme has also been arrested.

Yesterday, Andambi confirmed two senior-most KPC security staff have been suspended(pending investigations), while the services of a private security firm responsible for securing the right of way between Makindu and Nairobi Terminal have been terminated.

DCI has also questioned a number of KPC staff in relation to the siphoning which further links the executors to engineers and control rooms along the line (between Mombasa and Nairobi).

"There are staff who have written statements,” Andambi confirmed, “If any member of staff colluded with the criminals to do the connections and therefore lead to siphoning and loss of products, it will be punishable by law and according to the company's rules and regulations.”

The value of the siphoned product is yet to be known according to the management which is awaiting an ongoing configuration process, to be completed along-side the investigations.

Work on Line 5, as it is commonly known, started in July 2014 with the facility becoming operational in July 2018.

Senior KPC managers said Zakhem insisted on bringing in welders to supplement the locally based team. It argued that KPC and the country at large lacked enough skilled personnel for the job.

The Star has since confirmed KPC has 13 qualified pipeline welders 10 are recent graduates. This means during construction , the company had only three.

Poor supervision during the construction period is feared to have given welders an opportunity to create hot taps along the pipeline.

When the technical team wanted to be out there to supervise, someone in the office thought all they wanted was per-diem so the contractor and people on site had all the time to do their thing,” an insider told the Star.

KPC chairman John Ngumi said the board is awaiting the conclusion of investigations by the DCI but remains concerned on how the tapping was done.

The Lebanese company and KPC have also been on the spot over spillage at Kiboko, in Makueni, where the pipe gave way to petroleum products barely nine months after commissioning.