Kenya Pipeline, KRA Deal to Revolutionise Fuel Supply Logistics

Kenya Pipeline Company (KPC) and the Kenya Revenue Authority (KRA) have integrated their SAP and iCMS systems to hasten fuel supply logistics and supply chain operations. Synchronisation of the customs process is anticipated to reduce truck turnaround times at KPC depots by half.

Speaking during an oil and gas captains of industry forum that convened Oil Marketing Companies CEOs and leaders of industry associations, Energy and Petroleum Cabinet Secretary Opiyo Wandayi, a notable feature of the integration is the operationalization of Smart Gates by KRA, aimed at reducing truck turnaround times. The gates will improve throughput at KPC depots, significantly benefiting stakeholders in the value chain.

“The KPC and KRA integrated system went live on 6th April 2025. The integration is expected to revolutionise fuel supply logistics in East Africa. It will bring unprecedented efficiency and transparency to our processes seeing as it will enable visibility, predictability and certainty on the flow of the cargo. The system will further automate payment of taxes and clearance processes which will in turn optimize the cost of doing business and paying taxes” said KRA Commissioner Customs & Boarder Control, Dr. Lilian Nyawanda.

KRA has committed to aligning its working hours with KPC’s depot operations to support early and late loading activities. Oil Marketing Companies (OMCs) causing delays in truck clearance will face penalties for overnight stays as outlined in the Transportation Service Agreement (TSA) to minimize bottlenecks, she added.

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KPC Managing Director, Mr. Joe Sang, announced that the KPC Port Reitz tank farm connectivity to Kipevu Oil Terminal (KOT) 2, PS 14 and Line 5 (Nairobi-Mombasa pipeline) project has been successfully completed.

He noted that the tanks rehabilitation project involved conversion of five tanks previously used by KPRL for the storage of Crude Oil, to be used for storage of Automotive Gas Oil (AGO) while the Port Reitz connectivity project involved installation of transfer booster pumps, pipelines, electrical and instrumentation systems that directly connect KOT 2 to berthing ships. Additionally, the project included construction of a dump tank, a sub station and control room as well as integration of KPRL Port Reitz tank farm and KOSF into System Application Product (SAP) and other ICT systems.

“Kenya continues to incur significant demurrage costs due to inadequate ullage at the Kipevu Oil Storage Facility (KOSF). Following the commissioning of the KOT2 jetty in 2021, which has a design capacity of 250,000 MT per day, the need for expanded storage and efficient product evacuation became critical,” said Sang.

He said KPC has embarked on this project through which it has onboarded an additional 100 million litres worth of fuel storage into its systems. “With the additional storage capacity, we will see a reduction in demurrage costs that would ordinarily be passed on to the end consumer. We will also have enhanced operational flexibility and a quick turnaround of vessels discharging fuel products” said Sang.

Petroleum Institute of East Africa (PIEA) Chairperson Peter Murungi noted that working together with KPC will ensure efficient and sustainable fuel supply. He lauded KPC for undertaking capacity enhancement projects that have upgraded the fuel supply landscape in the country.

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