Kenya: Busy Times for KenolKobil

KenolKobil has recorded very positive results for the first half of 2011 that has seen its shares rise 9% in Nairobi. Having announced the successful fuel import product for October, the Kenya regulator has announced that KenolKobil has now been stopped from issuing fuel price forecasts.

KenolKobil has won tenders  to import and deliver 160,000 tonnes of Murban crude oil to Kenya in October, 40,000 tonnes of Jet-A1 jet fuel, due to be delivered in September. "The cargoes, totalling 200,000 MT, will contribute significantly in meeting both the country's and regional fuel product requirements," KenolKobil said in a statement. Kenya increased pump prices for petrol, diesel and kerosene for mid-August to mid-September citing a weaker local currency and slightly higher international fuel costs.

At the same time, the Kenya government has stopped fuel marketer KenolKobil from issuing fuel price forecasts ahead of the release of monthly prices by the regulator, arguing that it is distorting the currency and oil markets. The fuel marketer has been releasing monthly price forecasts,  days before price reviews by the Energy Regulatory Commission (ERC).

The Energy ministry’s comments came as Central Bank of Kenya (CBK) Governor Njuguna Ndung’u warned that the monthly fuel forecast by KenolKobil was putting pressure on the currency market as players rush to secure dollars on the projections.    

KenolKobil has had a long drawn battle with Kenya Pipeline Company  and the Kenya Petroleum Refineries Ltd over petroleum storage and distribution agreements and the payment of refinery fees that came to a head last July when the oil marketer was thrown out of the refinery for alleged breach of contractual obligations.

Meanwhile, KenolKobil has focused on its international expansion in Africa where it now operates in nine countries.

PETROLWORLD 25/08/11