Transporting oil via road remains cheaper than the new 48billion pipeline -MPs shocked

Kenya new pipeline, line 5. PHOTO | FILE

Energy regulatory commission officials found themselves on receiving end after parliament attacked them for not doing enough feasibility study before embarking on the 48 Billion oil Pipeline transportation project.

Transportation of petroleum products by road from the port of Mombasa remains cheaper than using the new Sh48 billion oil pipeline, the Energy regulator told Parliament on Wednesday.

 The Energy and Petroleum Regulatory Authority (EPRA) said road transport of petroleum products from Mombasa to Eldoret is cheaper by between Sh1,500 ($15) and Sh2,000 ($20) per cubic metre compared to pipeline transport.

Pavel Oimeke, the EPRA director-general told the National Assembly’s Energy Committee that it costs $89 per cubic metre to transport petroleum products through the pipeline from Mombasa to Kampala in Uganda. 

The same costs $75 per cubic metre to transport by road. EPRA said the cost of transportation of petrol products to Eldoret by pipeline is $54 and increases by $34 from Eldoret to Kampala. 

Energy committee and other MPs demanded answers from the energy regulator to explain why the costs for transporting oil through the pipeline remains high when the new Mombasa-Nairobi pipeline commonly known as Line 5 was expected to significantly reduce transport costs. 

"We spent more than Sh48 billion to improve pipeline efficiency from Mombasa to Nairobi. Why are we transferring costs to the customer when Kenyans invested heavily in the new Line 5?” Mr Purkose asked.

The Energy Regulatory officials were given one week before they appear again before the MPs. 

" Did the regulator went through all feasibility areas? How can we use tax to oppress the taxpayers? Kenyans financed the pipeline, now you want to increase oil prices and increase the burden to the financiers? " the shocked MPs asked the regulator.