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BOOST MT KENYA ECONOMY

Nairobi-Nanyuki railway to offer cheaper, safer fuel transport

Kenya Railways expects to generate over Sh370.4 million per year from the revived 240km line.

In Summary

• It will also improve the economy of the region by providing efficient and faster transportation of agricultural produce to the market.

• Kenya Railways will be charging about Sh82,000 for a single 50-tonne of fuel tank, with a tonne costing Sh1,640.

Alice Mbaki from Nanyuki on August 12, 2020
Alice Mbaki from Nanyuki on August 12, 2020
Image: /FREDRICK OMONDI

The newly refurbished Sh1.8 billion Nairobi-Nanyuki railway line is expected to pave the way for cheaper and safer transportation of fuel to the Central Region Economic Bloc.

It will also improve the economy of the region by providing efficient and faster transportation of agricultural produce to the market.

Kenya Railways expects to generate more than Sh370.4 million per year from the revived 240km line.

Petroleum products being the key cargo for this line, Kenya Railways will be charging about Sh82,000 for a single 50-tonne of fuel tank, with a tonne costing Sh1,640.

While on a a familiarisation tour of the line on Wednesday, Petroleum CS John Munyes said the transportation of petroleum products through the train will help solve some of the challenges such as adulteration. It will also remove trucks from the road, he said.

"This is a milestone as the line will also help sectors such as agriculture and mining," he said.

Laikipia Governor Ndiritu Muriithi said the refurbishment of the old metre gauge railway will open a new chapter in the region’s economy.

“This is what we need. The counties in Central Region Economic Bloc where the line is passing have an economic value of Sh2.7 trillion,” Muriithi said at Nanyuki.

He said the railway line will enable the region to import critical products such as fuel and farm input.

Already, Vivo Energy has constructed a fuel depot in Nanyuki with a storage capacity of 11.5 million litres on 11 acres. The company has started using the line to transport fuel.

Vivo Energy is the marketer of Shell Oil products. 

On Wednesday, the company transported seven train wagons with a capacity of 45,000 litres each.

Vivo Energy managing director Peter Murungi said the rehabilitation of the line is a big step as they strive to ensure that Mount Kenya region and neighbouring counties all the way to the Northern Frontier have sufficient fuel supply.

He said the overall oil demand for the region is 4,403,705 tonnes.

“Mount Kenya is a crucial area in our business. In this region, we have over 20 Shell petrol stations spread across the mountain circuit,” Murungi said.

He said they also have enough parking space that can take up to 48 trucks at a time.

Murungi said Vivo has been on a growth path since rebranding over seven years ago.

“The retail business has significantly grown from 121 service stations in 2013 to over 200 today,” he said.

Murungi said it will be more cost effective to use the train to transport fuel since they will be loading more products in one transfer than to have several trucks on the road.

Kenya Railways MD Philip Mainga said two trains have been moving petroleum products for Vivo.

"We are happy the line is in good condition," he said.

"The line will transform the economy of this region as it has a lot of potential," Mainga added.

Statistics from the Petroleum Institute of East Africa compiled in 2019 showed that Meru, Kiambu, Kirinyaga, Murang’a, Embu, Nyeri, Laikipia, Nyandarua and Tharaka Nithi have 801 retail stations.

This is a combination of oil marketing companies and independents.

The statistics showed that oil marketing companies were 242 while independents were 559.

The rehabilitation of the line was jointly done by the Kenya Defence Forces, the National Youth Service and Kenya Railway engineers. The rehabilitation started in February.

The Kenya Pipeline Company provided the funds for rehabilitation of the line.

The Sh1.8 billion used to support rehabilitation of the Nairobi-Nanyuki railway line, was part of KPC’s remittances to the exchequer in form of special dividends.

Edited by A.N