Kenya Pipeline Company (KPC) has concluded the takeover of the defunct State-owned Kenya Petroleum Refineries Limited(KPRL).
This marks the second time the facility is exchanging hands in the past eight years after Shell and the British Petroleum Company BP sold it to Indian investor Essar Energy Overseas Limited in 2016.
Essar Limited, which failed to revive the facility, relinquished its shares to the government after it failed to run it, just six months after acquiring it at a cost of $5 million.
Kenya Energy Permanent Secretary Andrew Kamau said the takeover coincides with the operationalisation of the New Kipevu Oil Terminal (KOT) which started a dry run this week at the port of Mombasa.
Mr Kamau said the acquisition was one of the government’s strategies to ensure a steady supply of petroleum products in Kenya and other East African countries.
“This week will start a dry run of the new KOT and it will improve the time of ships docking to discharge fuel which will reduce demurrage cost resulting to low petroleum products prices,” Kenya Energy Permanent Secretary Andrew Kamau as quoted by business daily.
He further added that the facility is set to become a region’s petroleum products feeding hub to compete with Dar es Salaam which has been dominating the market for years.
KPRL has 45 tanks with a total storage capacity of 484 million litres out of which 254 million litres are reserved for refined products while the remaining 233 million litres are reserved for crude oil.
Read also; KPC Seeks Adviser in Quest to Acquire Troubled State-Owned Oil Refinery.
