Kenya's government said Saturday it has begun the process of relocating Mombasa-based Kipevu oil terminal to create additional capacity at a cost of $120 million.
Kenya Ports Authority chairman Danson Mungatana said the new terminal, expected to be completed in 2018 and will reduce fuel pump prices in the East African nation.
"Preliminary design of the new facility has been undertaken and the relocation agreed upon by all stakeholders. The detailed design will cost 1.7 million dollars while construction of the facility will cost about 120 million dollars," said Mungatana.
The KPA chairman who was speaking during the official launch of the Kenya Oil and Gas Association in Nairobi said the new terminal will have capacity for two large vessels each carrying 100,000 tons of crude oil.
Kenyan oil firms have previously cited the high cost of refined petroleum products to losses incurred as a result of refining at the Kenya Petroleum Refineries Limited (KPRL) facility in Kipevu.
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Kenya plans to set up a sovereign wealth fund to invest revenue from future output of oil that Tullow Oil Plc (TLW) and Africa Oil Corp. (AOI) expect to start pumping as soon as 2016, central bank Chairman Mbui Wagacha said.
The country’s attorney general is “fine-tuning” a draft framework for the fund, which will shield the economy from cyclical changes in commodity prices, build savings for future generations and be used to invest in infrastructure, he said.
“We are unique in Kenya in that we are setting up our sovereign wealth fund prior to the phase of exploitation of natural resources,” Wagacha told reporters today in the capital, Nairobi, according to a live television broadcast. “The resources that we own today also belong to our future generations.”
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