Kenya expands oil storage

KPC building four new tanks to meet growing demand for fuels in East Africa sub-region

Kenya Pipeline Co will spend 5.3 billion shillings (Dh191 million, $52 million) building four new tanks that will increase its storage space by more than a fifth, Managing Director Joe Sang said.

KPC is adding capacity to meet growing demand for fuels in East Africa, the continent’s fastest growing sub-region, according to the African Development Bank. The additional tanks will accommodate increased volume from a new pipeline being built from the port of Mombasa to the capital, Nairobi, that will be completed in April, Sang said in an interview yesterday.

“The project will enhance operational flexibility, capacity of product receipt and evacuation of product in Nairobi once the new MombasaNairobi pipeline is operational,” he said.

The tanks will be built in Nairobi by May and each hold 33.4 million litres, increasing the state-owned company’s capacity to 745 million litres from 612.3 million litres. The Nairobi-Mombasa pipeline, known as No 5, will have a 20inch diameter and replaces an existing 14-inch conduit.

Kenya’s strategic petroleum reserves will triple to 90 days once the new tanks are commissioned and when an old refinery in Mombasa, which is now being used as storage, is refurbished, Sang said. Increased storage capacity will also save fuel-importers demurrage charges they’ve been incurring as vessels wait at the Mombasa port to discharge fuel into KPC’s system, he said.

Kenya distributes fuel to neighbouring countries including Uganda, Rwanda, Burundi and eastern Democratic Republic of Congo. KPC is currently building an oil jetty on Lake Victoria to improve the reliability of its supplies.