At least 80 per cent of imported petroleum products are destined for Kenya. However, this is partly because most of the products are first refined in Kenya before being re-exported to other countries. Industrial fuel also constitutes a significant proportion of petroleum products transited to Northern Corridor countries.
An oil pipeline links the refinery in Mombasa with Eldoret and Kisumu in western Kenya. Petroleum products are pumped to Eldoret and Kisumu, from where they are transported, mainly by road, to destinations in the landlocked countries.
From the oil pipeline terminus, petroleum products are shipped by tanker truck. However, this transport mode is deemed unsatisfactory: due to environmental impact of truck accidents and oil spills.
Besides, tanker trucks impose heavy damage on the road infrastructure.
A viable alternative is extending the oil pipeline from Kenya to Uganda and eventually to Rwanda.
Extension of pipeline to Uganda
The Governments of Kenya and Uganda have signed a Memorandum of Understanding to promote the extension of the Kenya Oil pipeline from Eldoret to Kampala. When this pipeline becomes a reality, it would ensure an efficient and environmentally friendly mode of delivery of fuel to landlocked countries.
Feasibility studies have confirmed the viability of extending the oil pipeline from Eldoret to Kampala. A feasibility study in 1999 found the project technically feasible, financially and economically viable. In July of the same year, a complementary study was undertaken to update the original study. Its findings were submitted in November 2001, recommending the construction of an eight-diameter, 320-km long pipeline with an annual capacity of 1 million m3. The capital cost for the entire project is estimated at $110 million.
The proposed pipeline will extend from Eldoret, Kenya, through Jinja, to Kampala, Uganda over a distance of approximately 320 km of which 118 km will be installed in Kenya and 202 km within Uganda. The pipeline will have a capacity of 220,000 litres per hour. Depots, terminals and tank farms are designated for installation at Tororo, Jinja, Kampala, and subsequently Masaka and Mbarara. However, final designation will depend on the outcome of economic feasibility studies.
The financing and implementation will be undertaken as a single project being supervised by the Kenyan / Ugandan Joint Co-ordination Commission. The project is intended to be a public-private partnership with the Governments of Kenya and Uganda, the KPC and a private entity. It is envisioned that a private company will build and operate the oil pipeline as well as be the majority shareholder.
When complete, the Northern Corridor Pipeline (NCP) will serve Uganda and the markets of the western Lake Victoria region. Products to be shipped include Premium Petrol, Diesel, Kerosene and Jet A1.
When fully operational, the Ugandan portion of the pipeline will run from the Uganda/Kenya border to Kampala and westward to a terminal determined to best serve the targeted markets.