NAIROBI, Kenya, Sep 29 – The State-owned National Oil Corporation of Kenya (NOCK) and Equity Bank have signed an agreement to provide retailers of National Oil Supa Gas cylinders, gas and accessories with credit facilities.
In the agreement, Equity will also extend financial assistance to any existing Liquefied Petroleum Gas (LPG) dealers seeking to upgrade their retail business.
“The bank will package financial products to reduce the entry barrier to cylinder ownership by enabling payment for the cylinders by affordable installments,” National Oil Acting Managing Director Sumayya Athmani said.
To qualify for the bank’s financing, those enrolled in the scheme should maintain an account with the bank and standard loan procedures will be applied in accordance with Equity’s lending policies.
The financing deal is part of National Oil’s strategy to spur retail business, a move that is in tandem with its statutory mandate to deepen the uptake of petroleum products in the country.
Increase in LPG use is anticipated and will aid environmental conservation through reduction in use of biomass such as charcoal.
“In the LPG financing arrangement, Equity will provide a collection account for National Oil customers, where resellers who engage in the scheme will remit loan payments. The loan facilities advanced to the applicants by Equity will be paid as agreed between the applicant and Equity Bank,” Ms Athmani said
To boost its market and stabilise oil prices in the country, National Oil has concluded an Asset Purchase Agreement with Total Kenya for some assets across the country.
In the transaction, National Oil will take over an LPG filling plant along Nanyuki Road in Nairobi and five filling stations, two within Nairobi, one in Mtito Andei, another in Thika Town and also in Garissa Town.
The oil marketer is mandated by the Government to supply 30 percent of the country\’s petroleum requirements in order to stabilise pump prices.