Connect with us

Hi, what are you looking for?

Capital Business
Capital Business

Kenya

Oil firm owes govt Sh2.3b

NAIROBI, Kenya, Feb 20 – Petroleum marketing firm Kenol-Kobil owes three State parastatals Sh2.3 billion, Parliament has been told.

In a Ministerial statement read by Energy Assistant Minister Mohammed Mahamud, the fuel company allegedly owes Kenya Pipeline Company (KPC) Sh1.2 billion.

Mr Mahamud also claimed that the figure arose from “failure to pay revised tariff for use of Kipevu Oil Storage Facility (KOSF), withheld payments to KPC by awarding rebates to themselves and illegal demurrage claims.”

Another Sh497 million is owed to the Kenya Petroleum Refineries Limited, after Kenol-Kobil allegedly refused to pay new processing fees for crude oil which was introduced by the government in 2006.

“Kenya Ports Authority (KPA) has informed the Ministry of Energy that they are owed by Kenol – Kobil Sh564 million as of March 1, 2008 for services rendered,” he added.

The Ministry was responding to a question raised by Yatta MP Charles Kilonzo, who wanted to know why the government was still awarding contracts to the oil marketer.

“Whereas the Government has not awarded any contract directly to Kenol – Kobil, both KenGen (power generating company) and KPLC (Power and Lighting Company) – both under the Energy Ministry – have running fuel supply contracts with this group,” said Mr Mahamud.

“There are no other companies that owe monies to the Government. They are all paying their processing fee to KPRL, storage and transportation fees to KPC and to KPA for ship berthing and doring services,” said the Assistant Minister.

KPC and KPRL have been involved in a protracted fees payment dispute with Kenol-Kobil, a matter that is currently pending before court.

Advertisement. Scroll to continue reading.

MPs sought to know why the government had not taken action against the company, and Speaker Kenneth Marende ordered the Minister to produce the respective court orders.

The Speaker questioned whether the court order barred the government from blocking future transactions with the oil firm, after MPs argued that the government would be within its rights to stop offering services to the company.

The debate is expected back in Parliament next week when the government produces the court order.

Click to comment
Advertisement

More on Capital Business

Executive Lifestyle

NAIROBI, Kenya, Mar 12 – The country’s super wealthy individuals are increasing their holding of bonds, gold and cash, a new report by Knight...

Ask Kirubi

NAIROBI, Kenya, Mar 9 – Businessman and industrialist Dr. Chris Kirubi has urged members of the public to exercise extreme caution when making any...

Ask Kirubi

NAIROBI, Kenya, Mar 24 – Businessman and industrialist Dr. Chris Kirubi is set to own half of Centum Investment Company PLC, following a go-ahead...

Ask Kirubi

It is without a doubt that the COVID-19 pandemic has caught the whole world by surprise. Although its full impact is yet to be...

Headlines

NAIROBI, Kenya, Mar 18 – Commercial Banks have been ordered to provide relief to borrowers on their personal loans, with loans eligible from March...

Kenya

NAIROBI, Kenya, Jun17 – Kenya’s tea leaves manufacturer Kericho Gold, has been awarded the Superbrands Seal by Superbrands East Africa for their quality variety...

Coronavirus

NAIROBI, Kenya, Apr 13 – As the local telecommunications industry gears up to roll out 5G networks in the country, the Communications Authority of...

Coronavirus

NAIROBI, Kenya, Mar 22 – Airtel Kenya is offering free internet access for students in order to enable continued learning at home in the...