Why you have been paying more for fuel every month

KPC says they have been passing losses from oil spills, theft to consumers

In Summary

• State corporation says an insurance company they engaged refused to compensate them. 

• Senators, however, question why firm cannot use its profits to replenish the loss.

Kenya Pipeline Corporation acting MD Hudson Andambi
LEAKAGE AND THEFT: Kenya Pipeline Corporation acting MD Hudson Andambi
Image: FILE

Ever wondered why you have been paying more for fuel every month? Wonder no more.

The Kenya Pipeline Corporation has been passing to you the cost of fuel it has been losing through frequent theft and leakages. 

KPC acting managing director Hudson Andambi on Wednesday told senators that consumers have been shouldering the burden. 

“If the loss is confirmed, then the costs definitely go to mwananchi,” Andambi told the Senate Energy and Petroleum committee. 

He revealed that KPC has been forced to pass on the cost because an insurance firm whose services the company sought declined to compensate them.

“There is a time we engaged and even gave them the figure of the loss but they dispute it and we asked them to conduct a forensic audit on our system. But we have never seen that report,” the MD said. 

Andambi made the revelations when he appeared before the committee to explain the skyrocketing retail pump prices.

The revelations, however, did not go down well with the committee chaired by Nyeri Senator Ephraim Maina which accused KPC of overburdening the taxpayer.

“That is quite unfortunate and disbarring. Why are you overburdening the taxpayers in this manner? How sure are we that these losses are not caused through a collision by your staff?” Maina asked. 

The senator asked why the state corporation has not been using its profits to replenish the lost oil instead of passing the cost to the consumer. 

Kericho Senator Aaron Cheruiyot demanded to know why the insurance company has not been forced to compensate KPC despite the state corporation paying premiums every month.

KPC has been losing fuel worth millions of shillings to theft, bursts and leakages along the pipeline.

In July, three people were arrested over the theft of an unknown quantity of fuel in Mlolongo. 

The suspects had been siphoning the product undetected for months by digging a tunnel from a compound down to the new 20-inch Sh48 billion Mombasa-Nairobi pipeline. 

In March, KPC lost millions after the oil spill in Kiboko River, Makueni, caused by a pipeline burst.

The corporation has been accused of failing to instal a leak detector along the pipeline to minimise leakages. 

Edited by R.Wamochie