DELAYS

Kisumu Oil Jetty sits idle amid slow works in Uganda

In Summary

•Initially, Uganda had said it would have completed constructing jetties by June, which later moved to September. So far the projects are yet to be completed

•If Uganda fails to deliver jetties, Kenya might be forced to use the revamped Kisumu port to transport products through Lake Victoria, a cost-effective mode expected to complement road transport

Petroleum and Mining CS John Munyes when he toured the Sh1.7 billion Kisumu Oil Jetty, September 20, 2018
Petroleum and Mining CS John Munyes when he toured the Sh1.7 billion Kisumu Oil Jetty, September 20, 2018
Image: MAURICE ALAL

Kenya will have to wait longer than anticipated to reap from the Sh1.7 billion Kisumu Oil Jetty (KOJ), even as Tanzania continues to grow her region’s petroleum export market.

This is on slow works on jetty facilities by neighbouring Uganda, which is a key destination for transit cargo and top petroleum export market for Kenya. Uganda has been shifting goal posts on completion of jetties meant to receive products loaded at Kisumu, rendering the Kenyan side facility idle one year and seven months since its completion.

KOJ construction commenced in June 2017 with the contractor, Southern Engineering Company (SECO) handing over to Kenya Pipeline Company (KPC) on February 28 last year, after completion. KPC had hoped Uganda would have finished its side by mid this year to commence operation where KOJ is expected to help the country recapture petroleum export market lost to Tanzania in recent times.

“Initially, they had said June, they moved it to September, now we are waiting for them to give us a new timeline,” KPC acting managing director Hudson Adhambi told the Star.

Uganda is the biggest bet for Kenya on regional export market, as it is developing two facilities one in Jinja by the Uganda National Oil Company (UNOC) and One Petroleum, while Mahathi Infra Services is expected to set up a facility at Bukasa Inland Port.

Kenyan authorities are now hoping Uganda will fast track completion of the projects to create an efficient and commercially viable integrated marine fuel transportation system for the region.

“We have no control… we leave it to Uganda to complete the project the way we completed the Kenyan one and we get into business,” Adhambi said.

This, even as concerns remain that failure by Uganda to put up facilities on her side could turn KOJ into yet another white elephant.

Delays by Uganda are putting Kenya under pressure in the wake of increased competition from the Central Corridor connecting landlocked countries to the Port of Dar es Salaam (Tanzania), to which Kenya has lost about 20 per cent of its export business in recent years.

The KPC management is now hoping the Kisumu jetty becomes operational by end of this year to help it recapture the lost business.

KOJ to become fully operational, there has to be counterpart oil jetties at various lake ports ready to safely receive and discharge products into bulk oil terminals.

“Uganda said they will be ready by end of this year. For us we are ready, if you give us a barge (small tankers) today, we will fill it,” KPC Chairman John Ngumi told The Star in a phone interview.

KPC’s Kisumu acting depot manager Paul Mibei recently said oil marketers and private logistic firms have signalled readiness to commence using the facility, which is expected to deliver petroleum products to Uganda, Rwanda into Burundi, Eastern DRC and parts of Tanzania.

KPC has two major facilities in the Western region–the Eldoret depot and Kisumu depot with storage capacities of 48 million litres and 45 million litres respectively.

Uganda remains Kenya’s top export market for imported oil products (super petrol, diesel, kerosene and Jet A 1-aviation fuel).

If Uganda fails to deliver jetties, Kenya might be forced to use the revamped Kisumu port to transport products through Lake Victoria, a cost-effective mode expected to complement road transport of petroleum products mainly from Eldoret and Kisumu depots.