Page 13 - AfrOil Week 05 2023

AfrOil PROJECTS & COMPANIES AfrOil

Kenyans face higher fuel

prices due to import delay

KENYA KENYA is facing surging fuel costs after a des- March-April pricing monthly cycle.
perate measure aimed at tackling high pump The fact that the winning fuel marketer is
prices through a government-to-government bound to be exposed to high insurance and
deal to import refined petroleum products failed freight charges due to limited timelines means
to materialise on time, forcing the country to that consumers will bear the burden of the
revert to the often-used open tender system. extra costs at the pump. Under the open tender
The Business Daily newspaper reports that system, the lowest-bidding marketer must be
the East African nation was banking on a gov- awarded the fuel import contract.
ernment-to-government arrangement that “Planned importation of petroleum through
would have involved entering into a deal with a government-to-government arrangement is
Asia-based producers to bring in products at a yet to be concluded and this has delayed tender
discount. calls for March 2023,” said EPRA in a letter to the
The plan was mooted last year when the State Department of Petroleum. “EPRA further
Kenyan government published the Petroleum notes that the delay has occasioned very tight
(Importation) Regulations, 2022, the major import timelines, which if no action is imme-
objective of which was to facilitate the importa- diately taken, may result in high rates of cargo
tion of fuel at much lower costs. The benefits of premiums and freight. As a result, pump prices
this scheme would have been passed on to con- would be negatively impacted.”
sumers. Kenya was looking to enter into deals The expected hike in pump prices comes
mainly with Saudi Arabia and the United Arab when Kenyans continue to feel the pain of high
Emirates (UAE), the country’s two main suppli- fuel prices, a situation that has been aggravated
ers of petroleum products. by a decision to scrap subsidies by the new
“Recognising the need for govern- administration. Currently, gasoline and diesel
ment-to-government arrangement for impor- are retailing at $1.4 and $1.2 per litre respectively
tation of petroleum products which may enable in Nairobi. ™
the country negotiate for discounts on product
cost and freight while at the same time enabling
the country to access extended credit peri-
ods from suppliers. This will save the country
from the current pressures on foreign exchange
reserves,” states part of the regulations.
However, a delay in actualising the deal is
now exposing consumers to expensive fuel
in the coming months after the Energy and
Petroleum Regulatory Authority (EPRA) was
forced to revert to the open tender system to
bring in the next consignment to be sold in the Kenya’s government is trying to address rising pump prices for fuel (File Photo)

PROJECTS & COMPANIES
Kinetiko Energy delivers “outstanding”

gas results from core well 271-23C

SOUTH AFRICA KINETIKO Energy, an Australian exploration The ASX-listed firm said in a statement on
and development company, has said that des- January 30 that the results from its Majuba core
orption testing from one of its wells in north- well 271-23C were record-breaking, adding that
eastern South Africa achieved a peak of 13 cubic results from recently-completed well 270-06C
metres per tonne. were expected shortly.

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