ACHIEVEMENTS AND COMMITTMENTS
Over the last three years, Kenya has significantly reduced the demurrage costs of petroleum products landing at the port of Mombasa from a high of Kenya shillings 3,490,227,805.50 (US dollars 27,056,029.50) paid in 2021/2022 to Kenya shillings to 1,152,354,807.00 (US dollars 8,932,983.00) paid in 2023/2024. This marked reduction in demurrage costs was attributed to enhanced capacity to manage the process.
Demurrage costs are the charge payable to owners of chartered ship on failure to load or discharge the ship within the stipulated timelines. The gradual reduction in demurrage costs in 2022/2023, were pegged at Kenya shillings 2,365,682,142.54 (US dollars 18,338,621.26). This has been a big plus for the country as it implies cost savings to final costs of petroleum products.
During the same period, the country increased the flow rate of Kenya Pipeline Company’s line 5 by 37% from 950M3/h previously registered to 1,300m3/h in 2003. For the coming year, the Ministry aims to improve this further to ensure increased access to petroleum and gas products.
Cabinet Secretary Opiyo Wandayi of the Ministry of Energy and Petroleum tabled this on 7th October 2024 during the validation of the Ministry’s Financial Year 2024/2025 Performance Contract by the Performance and Delivery Management Unit.
In an exercise led Mr. Eluid Owalo, Deputy Chief of Staff (DCoS) for Performance and Delivery Management, the Ministry shared its FY 2023/2024 achievements as well as the FY 2024/25 commitments aligned to the Government’s Bottom-Up Economic Transformation Agenda(BETA).
For the FY 2024/2025, the State Department for Petroleum has committed to:
I. Enhance exploration and investment in Petroleum Blocs for the development of petroleum resources. In this aspect, the State Department will promote petroleum potential through participation in the East African Petroleum Conference Exhibition of 2025;
II. Increase flow rate for Kenya Petroleum Corporation per hour in line 5 by 37% from 950 M3/Hour in 2022 to 1,300 M3/hours in 2024;
III. At the same time, it will endeavor to reconstitute and publish the Petroleum Bloc Map;
IV. Ensure the security of supply and distribution of competitively priced petroleum products; and
V. Develop new infrastructure for clean cooking gas in 60 public learning institutions to promote the use of Liquefied Petroleum gas (LPG) in households and learning institutions.
This will include the construction infrastructure for Clean Cooking Gas in 40 Public Learning Institutions, completion of development of LPG infrastructure in the pilot 20 learning institutions started in FY 2023/2024 and the distribution of 60,000 6kg gas cylinders and associated accessories to households by the National Oil Corporation of Kenya (NOCK).
CS Wandayi called for scheduled monitoring of the implementation of the Performance Contract to be implemented from 1st July 2024 to 30th June 2025.
Ends