Kenya Ports Authority (KPA) is set to move its 50 year old Kipevu Terminal to a new site on the southern side of the port, opposite the current container terminal. This is in a bid to pave way for the construction of a new oil terminal in Mombasa in 2016.Preliminary designs on the planned relocation have been finalized with the tendering process expected to kick off early 2016. The relocation is expected to cost $120 million (KES12.3 billion) with the preliminary design costing $1.7 million (KES173.7 million).
With its relocation, country’s petroleum handling and storage capacity will increase by about 400 per cent including loading capacities once completed in 2018 whilst, allowing four large tankers of up to 150,000 tonnes to berth at the simultaneously. A Danish Consultancy firm, Niras will oversee the relocation of the terminal.
In September, Kenya Pipeline Company leased oil storage facilities from private investors in Nairobi and Mombasa in a bid to improve product distribution and supply. The company sought to lease from already operational terminals in Nairobi and Mombasa with a capacity of 30 million litres and 100 million litres, respectively.
In 2014, the government took over the management of a private oil terminal in Kipevu, Mombasa, raising hope of lower storage penalties for oil marketers, which will ultimately lower product prices. According to Kenya Economic Survey 2015, Kenya imported petroleum products worth KES292.6 billion up from KES252.7 billion the previous year. Tanzania is also building a new oil terminal to increase efficiency in the delivery of fuel for domestic purposes.