Rift Valley Railways (RVR) has signed a three year service-level contract agreement of KES 13 billion with Hass Petroleum to deliver 130 million litres of diesel. Hass Petroleum won the contract against five companies including Total, Vivo Energy and Kenol Kobil in the tender oil offered by RVR.
Hass will be entitled to managing the fuel facilities and ensure maximum stock levels in RVR operations to lower cost. The oil company will supply fuel worth KES 3.3 billion in the current year to June 2015 and the volume is set to go up over the subsequent years. This will see RVR increase cargo capacity through acquisition of more locomotives fleet in March 2015.
According to Petroleum Institute of East Africa (PIEA) data, Hass Petroleum is Kenya’s eleventh oil marketer with a market share of 1.7% as at March 2014.
Last year Kenya’s total fuel consumption stood at 4.6 billion litres with diesel and other variants accounting for more than half of total fuel used.
In September 2014, RVR commissioned three General Electric B23-7 locomotives to ease efficiency in freight volumes. This commissioning came after RVR announcement that it had secured a KES 1.8 billion asset financing with Standard Bank of South Africa and CfC Stanbic Bank towards the acquisition of 20 locomotives from the United States of America.