The Government has licensed Nile Petroleum East Africa to build an offshore multi-products landing stage and onshore storage terminal in Mombasa.

The company, which is a joint venture between local investors and Nile Petroleum Company – wholly owned by Sudan government – said the project would alleviate storage shortage at the port.

It is estimated that oil importers lose about $200 million (Sh18 billion) annually as demurrage fees charged by ship owners if cargo is not offloaded during agreed time.

Energy ministry said the construction of the jetty and onshore oil storage facility for all petroleum fuels, including cooking gas, automotive gas oils and heavy fuel oil, would guarantee security of supply of the products.

“In addition to enhancing efficiency in handling imports and turn-around of imports, it will reduce costs through elimination of demurrage,” Energy Permanent Secretary Patrick Nyoike said in a letter dated April 20.

Serve the region

In a statement yesterday, Nile Petroleum East Africa Managing Director, Nasr Eldin Elhussein, said the license to construct the storage is the culmination of long talks between Nile Petroleum and local partners to set up a company in Kenya to serve the region.

He said that the company had looked at the bottlenecks chocking the oil terminal at Mombasa, and proposed the construction of the storage terminal to aid the situation.

“We look at what we can offer the Kenyan market and what we can do to the whole country by providing high-quality products that meet or exceed customer satisfaction,” he said. “Also, we want to inculcate health, safety and environment best practices among company’s employees, vendors and contractors.”

Mr Elhussein said the company would also open filling stations, sell lubricants and cooking gas in addition to storing products.

“We are not looking at competition and we are not coming here to take business from others but to give more services to Kenyans,” he said.

Sudan is not a member of the Organisation of Petroleum Exporting Countrie , but was granted observer status in August 2001, a sign that it is recognised as a significant oil producer. Its proven oil reserves are currently estimated at 563 million barrels.

Source: http://www.standardmedia.co.ke/InsidePage.php?id=2000038588&cid=14&j=&m=&d=