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The Jomo Kenyatta International Airport nearly plunged into a crisis last week following the shortage of jet fuel that saw airlines restricted from fuelling at the facility.

The move was blamed on oil marketers who ordered less fuel than the existing demand, hence creating a deficit.

The recent development, which was last witnessed in Kenya in 2014, brings to questions the reliability of private players to run a crucial sector of the economy and lack of a fuel reservoir to act as buffer in times of shortage.

The Kenya Pipeline Company, a state owned firm that manages the oil pipes and provide storage for fuel, argues that it is time the country established a reservoir for oil, just as it is the case with food reserves.

“The recent scenario highlights the importance of having an oil reservoir in the country to forestall supply challenges in the event of a shortage,” said KPC acting managing director Hudson Andambi.

Mr Andambi says the shortage would have been prevented if the oil marketers brought in sufficient stocks to meet the demand.

Oil marketers insist that the stocks they had ordered were sufficient to last until the next consignment.

However, KPC says the shortage was caused by low orders of jet fuel by oil marketing companies, compared to planned imports. For instance in January, the sector was alarmed when marketers placed an order of 37,000 tonnes despite a request of 60,000 tonnes.

Limited stocks

Airlines at JKIA were last week forced to fly to regional airports for fueling following limited stocks of jet fuel at the airport that KPC had warned would be depleted by last Thursday .

Mr Andambi said the situation would have been worse were it not for the strike by Kenya Airports Authority employees that saw demand for jet go down. A similar scenario was witnessed in the country in 2014 where the government sought assistance for an emergency delivery of jet fuel from the neighbouring Tanzania.

An oil expert alleges that the fuel shortage might have been deliberately caused by marketers who would tend to have low stocks for accounting purposes.

“It is always a habit that oil marketers, especially the ones that are listed, to have low stocks at the end of the month, normally for accounting purposes,” says an expert who has worked with a multinational company, but sought anonymity.

The expert also argued that the marketers could be having much of the other type of fuel filled in the new pipeline, which could have impacted on their cash flow.

“The new line five must have taken about 70,000 tonnes of oil that had to be filled by the oil companies and this might have had an impact on the cash flow of the marketers,” he said.

Normal supply

The situation was normalised after a vessel carrying 115 million litres of jet fuel docked at the Port of Mombasa on Tuesday last week and started discharging fuel at 5pm.

According to KPC, the volume discharged has already been introduced into the line and has been pumped to the system, normalising the supply at the airport.

KPC said there is sufficient supplies of Jet A-1 to last for at least 11 days following the arrival the vessel in Mombasa last week.

“As of today (March 12, 2019), we have 26.2 million litres in the KPC Embakasi depot at JKIA. We will receive an additional 32 million litres to the same depot in the next six days as we move to spruce up our stocks at the busy airport,” said Mr Andambi.

“To ensure a steady supply of jet fuel in the days to come, we expect another vessel to deliver an additional 103 million litres of aviation fuel in the port of Mombasa on March 28,” he added.

Mr Andambi told Shipping and Logistics that they were writing to Kenya Civil Aviation Authority to withdraw the Notam ( a notice to airmen ) that had been issued during the shortage at the airport.

“Because the supply is now back to normal, we will be writing to KCAA so that they can lift the Notam that had been issued,” he said.

A new initiative is set to be rolled out as part of efforts to comprehensively deal with pollution along the Northern Corridor, a key regional transport artery.

The details of the project are contained in concept paper released in January titled ‘Reduction of greenhouse gas (GHG) and pollution in the freight transport sector along the Northern Corridor’.

The document was done by the Northern Corridor Transit and Transport Co-ordination Authority (NCTTCA) and supported by Trade Mark East Africa (TMEA).

The NCTTCA members are Kenya, Uganda, Burundi, Rwanda, Southern Sudan and the Democratic Republic of Congo (DRC).

Head of Transport policy and planning at NCTTCA Aloys Rusagara said the initiative is part of other projects the organisation rolled out several years ago to mitigate pollution in the maritime sector in line with the International Maritime Organization (IMO) rules on greenhouse gas emissions.

“The policy organs directed the NCTTCA to implement the green road freight program between its member states in 2016 and by 2017, we had already done a baseline survey for emissions at the Port of Mombasa,” Mr Rusagara told Shipping at the organisation’s offices in Mombasa.

The NCTTCA was charged with assessing the level of pollution from the port to the final destination of the goods

“We have already drafted a work plan towards achieving that programme aimed at meeting the directive in order to reduce greenhouse gas emissions and entire pollution within the transport sector, from the Port of Mombasa to the final destination of the consignments,” he added.

Kenya Transporters Association

The execution of the plan, he added, will involve other players such as the Kenya Transporters Association whose members own trucks that operate along the corridor.

“There is going to be a number of activities including implementing sensitisation activities for users. Currently, member states are in discussion so that we can plan the activities for implementation…,” he added.

Mr Rusagara said TMEA is expected to fund the project to the tune of $100,000 (Sh10 million) in the first year.

NCTTCA in the concept document details how the transport sector is impacting the environment, and contributing to climate change challenges.

“The size of logistics sector in EAC is estimated at $15-25 billion per annum. The EAC economies are growing rapidly increasing the transport sector at the same pace. Consequently, Freight Transport Sectors are nationally one of the fastest growing sources of Greenhouse Gas (GHG) emissions and pollution,” NCTTCA said in the document.

The document further said the German Corporation for International Co-operation (GIZ) and the Kenyan Ministry of Transport have estimated that Heavy Goods Vehicles (HGV) cause most emissions at 40 percent in the transport sector.

The study also indicated that mitigation potential is estimated to be highest in the truck trafficking (HGVs).

Trends in the transport sector in the other EAC countries are rather similar to the Kenyan situation, although corridor impact is highest in Kenya and Tanzania.

Uganda is in the process of preparing National Transport Sector Policy and Strategy, which includes ambitious GHG emission and pollution reduction targets. In Rwanda environmental policies and principles have been high on the national agenda for years.

The document has also identified potential GHG emission reductions in transport sector, indicating that experiences around the world show that training in efficient logistics and economic driving offer comparative advantage to companies.

Emissions

Experts say economic driving is a relatively low-cost and fast action to reduce fuel consumption and emissions significantly.

Private sector involvement has been key in providing support for drivers training on fuel efficient driving, waste management, safety and personal coaching.

Players say low carbon technology in the transport sector is developing fast and has a lot of opportunities to be adopted into on-going projects and activities in various countries.

“ICT can provide solutions for real-time logistics efficiency improvements, fuel consumption and cost savings of individual vehicles, which can also be used as incentive for drivers,” states the document seen by Shipping.

Alban Odhiambo, director, ICT for Trade and Transport Facilitation at Trade Mark East Africa (TMEA), said the organization works in collaboration with the various stakeholders who use or regulate activities on the corridor.

“Our strategy includes addressing climate change issues that are related to trade and transport. At a corporate level TMEA has developed climate change interventions that are geared towards addressing Green House Gas Emissions related to trade along the corridor and one of the key ones is the development of performance and monitoring indicators along the corridor on GHG emissions,” said Mr Odhiambo.

He said the organisation’s role as one of the facilitator is to to support corridor actors to embrace and deploy climate-friendly techniques and tools in their operations

Source: Business Daily