Press Center | Freight Shipping Logistics News
Oct 10, 2010
General
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Kenya is under pressure to ensure that Uganda gets a regular supply of fairly priced refined petroleum products to keep the country’s economy stable.
Kenya is under pressure to ensure that Uganda gets a regular supply of fairly priced refined petroleum products to keep the country’s economy stable.
The landlocked country has lately been experiencing shortage of fuel leading to a rise in the cost of petrol.
Uganda’s Energy permanent secretary Kabagambe Kalisa was in the country last week to find out the causes of erratic fuel supply, which threatened to increase the cost of goods and services.
Mr Kalisa toured key petroleum installations in Mombasa. Two Ugandan officials also visited the Kenya Pipeline Company depots in Nakuru and Eldoret.
Kenya’s Energy permanent secretary Patrick Nyoike blamed the disruption on the new centralised tender system for importation of refined fuel destined for Uganda and other countries.
“Only companies with import and trading licences in Uganda and other countries will be allowed to participate in the open tender system (OTS) of transit fuel,” he said.
On September 28, the Ministry of Energy awarded Galana and Gapco tenders to import diesel and petrol, respectively, to reduce the number tankers waiting for long to discharge fuel in Mombasa.
Under OTS, a company that submits the lowest bid imports either crude oil or refined petrol, diesel and kerosene on behalf of other marketers.
While Total and MGS International said importing of transit fuel under OTS will enhance supply to Uganda, some marketers argued the tender was introduced without proper consultation with companies.
Opposition to the transit rules stems from the fact that some companies risk shrinking profits as the tender will enhance transparency in procurement.
Should be harmonised
Other marketers said transit tender and local fuel tender should be harmonised to take advantage of economies of scale.
Mr Nyoike said unprogrammed private imports had been identified as primary causes of congestion at the port of Mombasa.
Marketers were informed on September 20 by the ministry that no private imports for transit markets shall be allowed through Kipevu oil storage facility in Mombasa from individual marketers.
Such cargo shall be aggregated for all the transit marketers and processed through the Ullage (storage space) Allocation Committee.
The landlocked country has lately been experiencing shortage of fuel leading to a rise in the cost of petrol.
Uganda’s Energy permanent secretary Kabagambe Kalisa was in the country last week to find out the causes of erratic fuel supply, which threatened to increase the cost of goods and services.
Mr Kalisa toured key petroleum installations in Mombasa. Two Ugandan officials also visited the Kenya Pipeline Company depots in Nakuru and Eldoret.
Kenya’s Energy permanent secretary Patrick Nyoike blamed the disruption on the new centralised tender system for importation of refined fuel destined for Uganda and other countries.
“Only companies with import and trading licences in Uganda and other countries will be allowed to participate in the open tender system (OTS) of transit fuel,” he said.
On September 28, the Ministry of Energy awarded Galana and Gapco tenders to import diesel and petrol, respectively, to reduce the number tankers waiting for long to discharge fuel in Mombasa.
Under OTS, a company that submits the lowest bid imports either crude oil or refined petrol, diesel and kerosene on behalf of other marketers.
While Total and MGS International said importing of transit fuel under OTS will enhance supply to Uganda, some marketers argued the tender was introduced without proper consultation with companies.
Opposition to the transit rules stems from the fact that some companies risk shrinking profits as the tender will enhance transparency in procurement.
Should be harmonised
Other marketers said transit tender and local fuel tender should be harmonised to take advantage of economies of scale.
Mr Nyoike said unprogrammed private imports had been identified as primary causes of congestion at the port of Mombasa.
Marketers were informed on September 20 by the ministry that no private imports for transit markets shall be allowed through Kipevu oil storage facility in Mombasa from individual marketers.
Such cargo shall be aggregated for all the transit marketers and processed through the Ullage (storage space) Allocation Committee.
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