Page 5 - DMEA Week 29

DMEA Commentary DMEA
budget de cit, which Nairobi is aiming to slim to around 5.9% of GDP in the year to June from 7.2% in the preceding period.
However, the commission also cited the potential for improvements in governance at some of the companies as a secondary reason for the sales. is rationale appears highly pertinent to KPC, which has been faced with a long stream of nancial mismanagement allegation, though at the time Ngumi called the move “irrational andillogical”.
At the end of November, he summoned an extraordinary meeting of the reportedly war- ring board to discuss a new scandal surrounding purported inaccurate reporting of fuel spillages from the pipeline network, but failed to come to an agreement.
KPC also found last year that fuel was being stolen on the sinendet-Kisumu pipeline at Kibos and Koru, with highly skilled engineers thought to have been involved.
A scandal also came to light over a new oil jetty at the western port of Kisumu on the shore of Lake Victoria, which was handed over to KPC in February 2018, with considerable fanfare by the local contractor, southern engineering Co.
KPC’s then-managing director Joe sang repeatedly justi ed the facility on the grounds of a major projected llip to regional fuel exports, which account for more than 10% of the coun- try’s export revenues, primarily to Uganda.
Kenyan sources anticipate that the latest scan- dal will lead to the dismissal and trial of several senior officials, while two suspects that were arrested in mid-July were released on bail a er spending a week being questioned.
Corporate crisis
The news comes at a time of crisis for KPC, which is currently still dealing with a major oil leak in Kiboko.
It is also set for more public relations prob- lems as it prepares to evict those who have built dwellings along the route of the proposed pipe- line that will connect the country’s inland oil deposits with export facilities on the coast.
Meanwhile, Ngumi said this week that the adulterationoffuelinthecountryhadcurtailed product exports to neighbouring countries by up to 50%.
Allegations of corruption claimed a victim in sang in mid-June 2018 and the latest string of events will likely ensure that he is soon followed by other senior o cials, and should the talk of Zakhem’s involvement prove accurate, the scan- dal could have consequences well beyond Ken- ya’s borders.™
Heavy machinery was used to excavate the area where
the siphoning was discovered.
One of the tankers used to transport the stolen fuel.
Week 29 24•July•2019 w w w . N E W S B A S E . c o m
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