The Kenya Pipeline Corporation (KPC) is set to take over the defunct state-owned Kenya Petroleum Refineries Limited (KPRL) to increase its storage capacity and diversify operations.
Energy Cabinet Secretary (CS)Davies Chirchir said negotiations with the National Treasury for the takeover were at an advanced stage.
“We have engaged the National Treasury and plans are on course to fastrack this initiative,” he said.
The CS said once the deal is finalized, KPC will take over all KPRL assets at the port of Mombasa to enhance its storage capacity and build additional facilities for Liquefied Petroleum Gas (LPG).
KPRL which was originally set up by Shell and British Petroleum Company (BP) has 45 tanks with a total storage capacity of 484 million litres.
This additional storage, the CS said would unlock supply chain bottlenecks in Mombasa and ensure steady supply of the commodity in the country and neighbouring countries of Uganda, Rwanda, Burundi, South Sudan and the Democratic Republic of Congo (DRC).
“We are talking about banking three months’ supply which is about 200 million litres. Therefore, the assets we have at KPRL will come in handy,” he said.
Speaking in Kisumu during a tour of KPC facilities in the area, the CS said the move was set to address the shortage of the commodity and ensure constant supply across the country and region.
Following President William Ruto’s directive to scale up LPG coverage in the country, the CS said part of the land owned by KPRL will be used to build additional storage tanks for LPG.
The ministry of energy, he added has put in place measures to ensure the LPG project is delivered on time for Kenyans to have access to clean cooking energy.
“Over the next two years you are going to see accelerated development of LPG as directed by the president,” he said.
KPRL which was set up to refine crude oil stopped operations in 2013 after the government started importing refined oil.
The government acquired the facility after Essar, an Indian fine failed to revive it.
By Chris Mahandara