Kenya-Uganda Finally Resolve Oil Importation Dispute


After months of dispute and legal contention, Uganda and Kenya have finally reached a significant agreement that promises to reshape their energy relations after inking a new oil deal.

The deal, signed on Friday, May 10, paves the way for Uganda’s state oil firm to import petroleum products through the port of Mombasa, effectively ending a protracted disagreement between the two East African neighbours.

The signing ceremony, held at the Ministry of Energy and Petroleum offices in Nairobi, marked the culmination of several weeks of negotiations and discussions between the parties.

Key agreements, including the Transportation and Storage Agreement (TSA) and the Tripartite Agreement (TPA), were inked, signifying a new era of cooperation between Kenya and Uganda in the energy sector.

The deals between the Kenya Pipeline Company and Uganda National Oil Company Limited (UNOC) not only allow Uganda to import oil through the port of Mombasa, but also allow the UNOC to store oil with KPC.

Kenya Pipeline Company (KPC) celebrated the deal as a major milestone, with company officials expressing optimism about the prospects of capturing regional markets.

 “This is a major milestone for KPC as the company solidifies its efforts to capture the regional markets as part of our growth and expansion strategy,” stated a spokesperson for the company.

Speaking at the event, Kenya’s Cabinet Secretary for Energy and Petroleum, Davis Chirchir, pledged unwavering support for Uganda National Oil Company Limited (UNOC). 

“We look forward to a mutually beneficial relationship with UNOC and Uganda,” affirmed KPC.

Meanwhile, John Friday, Assistant Petroleum Department at the Ministry of Energy Uganda, hailed the Kenyan government for facilitating the new importation agreement.

“The Kenya Government’s support is crucial in enabling Uganda to access vital petroleum products through the port of Mombasa,” Friday remarked.

Energy CS Davis Chirchir with KPC MD Joe Sang and John Friday, Assistant Petroleum Department at the Ministry of Energy Uganda.

Photo

Ministry of Energy

The resolution of the dispute comes on the heels of a legal battle between Uganda and Kenyan oil traders, which had threatened to derail the negotiations.

A case filed at the High Court in Machakos seeking to block the licensing of UNOC was withdrawn after the parties reached a consent before High Court Judge Francis Rayola.

Uganda had escalated the matter to the East African Court of Justice (EACJ), accusing Kenya of placing unrealistic restrictions on UNOC’s access to the Kenya Pipeline Company’s system.

Uganda’s attorney general argued that these restrictions violated various articles of the EAC Treaty and the Protocol for the Establishment of the East African Community Common Market.

Despite the resolution of the dispute, Uganda is pushing forward with an ambitious energy project, to build a Ksh1.3 trillion oil pipeline.

Uganda is in the process of constructing the East African Crude Oil Pipeline (EACOP), which, upon completion, will transport crude oil to the Tanzanian port of Tanga.

Kenya Pipeline Company (KPC) Limited

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