Kenya Pipeline Company (KPC) and Mahathi Infra Uganda Limited commenced tests on December 29, with the shipping of the first consignment of 4.5 million litres of fuel products from Kisumu to Entebbe, Uganda.
Mahathi’s MV Kabaka Mutebi II moved products during the period, when KOJ and the receiving facility were under assessment.
The jetty by Mahathi Infra Uganda Limited runs about 270 metres into Lake Victoria.
It has put in place storage tanks with a capacity of 70 million litres.
Mahathi Infra (Uganda) Limited chairman George Mukula yesterday confirmed to the Star trials are complete, setting pace for full commercial operations, with the second barge expected to come into operation later this year.
"Its construction is currently at 85 per cent complete," Captain Mukula said.
He said once complete, the will be operational within 90 days of safety testing and calibration.
Presidents William Ruto and his Ugandan counterpart, Yoweri Museveni are expected to commission the KOJ-Entebbe projects before the end of June.
Mahathi targets to have at least four vessels in the medium-term.
“We are expanding our capacity. This will be one of the largest bilateral trade engagements with Kenya,” Mukula told the Star.
Exports are set to go beyond Uganda, into South Sudan, DR Congo, Rwanda, Burundi and Tanzania.
Currently oil tankers take up to 72 hours by road between Kisumu and Kampala, mainly as a result of the long queues at the Malaba border.
It takes about 14 hours to move products from Kisumu to Uganda by lake, doing away with the frequent border delays, with the reduction of tankers on the roads seen a boost to road safety.
One barge is the equivalent of 60 oil tankers moving fuel by road.
Mahathi has struck a deal with Total while talks are on with 19 other Oil Marketing Companies for the use of the Kisumu facility and its facility in Uganda, which was partly funded by Equity Bank.
Uganda is also expected to put up another facility in Jinja by the Uganda National Oil Company (UNOC) and One Petroleum.
An enhanced Lake Victoria transport logistics system is seen as a major boost for Kenya, which is seeking to grow exports, and regain its market share, which has been lost to neighbouring Tanzania in recent years.
According to Kenya’s Energy and Petroleum Regulatory Authority (EPRA), the volume of total petroleum exports decreased from 832,100 in 2020, to 610,800 in 2021.
“The share of re-exports to total exports dropped marginally from 96.6 per cent in 2020 to 96.3 per cent in 2021,” EPRA notes in its latest industry data released on January 9.
This came even as the quantity of petroleum products imported by Kenya increased by 12.0 per cent, from 5.7 million tonnes to 6.4 million in 2021, which EPRA attributes to “an increase in mobility after the up- lifting of the Covid 19 containment measures.”
Kenya Pipeline, which has been serving Uganda and the hinterland through the Kisumu and Eldoret depots, with road as the main transport mode, has lost about 20 per cent of its export business in the last four years.
Competition remains high on the Central Corridor connecting landlocked countries to the Port of Dar es Salaam (Tanzania).
Kenya serves the region through the Northen Corridor that connects the Port of Mombasa to the hinterland.
Eldoret and Kisumu depots have storage capacities of 48 million litres and 45 million litres, respectively.
With the two facilities in Uganda and Kenya operational, it creates a stable and sustainable fuel supply system, according to experts.
The project has the potential to turn Kisumu into a focal point of oil and gas commerce in the region making it one of the busiest inland ports in Africa, according to Kenya Pipeline.
To ensure the new jetty is adequately supplied and can sustain the export market, KPC is banking on the 122km Sinendet-Kisumu pipeline, which is commonly referred to as Line 6.
The pipeline, which became operational in 2016, has also boosted petroleum product availability in western Kenya, which used to experience frequent fuel outages.
