Nairobi, Kenya | – Construction works for the new Mombasa to Nairobi oil pipeline are set to commence following Wednesday’s signing of a 35 billion shillings loan between Kenya Pipeline Company and a consortium of six local and international banks.
The new 20-inch pipeline whose construction is expected to be complete in 18 months, will replace the current ageing one that has served the country for close to 40 years.
The Kenya Pipeline Company is seeking to build a new 450 km oil pipeline from Mombasa to Nairobi to replace the aging 14 inch pipe that has been operational for the last 36 years.
The new 20 inch diameter pipeline is being built to increase piping capacity to meet increasing demand for petroleum products both in Kenya as well as other East African countries.
Seven years ago, the government spent 7.8 billion shs on doubling the flow rate of the 14 inch pipeline from 440,000 litres an hour to 880,000 litres per hour.
Under the deal signed, the loan would finance 70 percent of the new pipeline cost while Kenya Pipeline Company will avail the remaining 30 percent own resources. This pushes the projected total cost of the new pipeline to 48.4 billion shillings.
Early this month, Kenya Pipeline Company signed a 43 billion shs contract with Lebanese firm Zakhem International to undertake construction of the new pipeline.
The project involves construction of four new mainline pumps at Changamwe, Maungu, Mtito Andei and Sultan Hamud and two booster pumps at Kipevu.
In addition, the firefighting system in Jomo Kenyatta International Airport and the Nairobi terminal would be upgraded.
Construction of the new pipeline is projected to be completed in 18 months and will run parallel to the planned Lamu port, South Sudan Ethiopia transport, LAPSSET, project which involves the construction of a pipeline from Lamu to South Sudan.
Zakhem International is required to build a fibre optic cable along the new pipeline route and install four pumping stations.
Plans are also underway to develop additional extensions of the pipeline and for Kenya Pipeline Company to lease some of its storage facilities and build others under the Public Private Partnership program.