The Kenya Pipeline Corporation (KPC) has come under scrutiny following an audit that flagged a Sh2.8 billion payment made this financial year to a Lebanese firm. This probe, conducted by the Directorate of Criminal Investigations (DCI), has raised concerns about financial accountability, with taxpayers ultimately shouldering the cost of the investigation.
Despite this controversy, KPC has demonstrated strong financial performance for the fiscal year ending June 30, 2024. The corporation remitted Sh7 billion to the National Treasury, showcasing its operational efficiency and profitability. Managing Director Joe Sang highlighted that the company achieved a 20% growth in profit before tax, rising from Sh7.6 billion in the previous year to Sh10.05 billion. This robust financial position has allowed KPC to continue contributing significantly to national development initiatives.
A key factor in KPC’s success has been its ability to reduce pipeline product losses well below the global industry benchmark. The corporation lowered losses from 0.25% to 0.06%, demonstrating improved efficiency in petroleum transportation. These operational gains align with KPC’s Vision 2025 strategy, which aims to position it as Africa’s premier oil and gas company while strengthening Kenya’s status as a regional energy hub.
Deputy Chief of Staff for Performance and Delivery Management, Eliud Owalo, underscored KPC’s crucial role in Kenya’s energy sector and its contribution to the Bottom-Up Economic Transformation Agenda (BETA). Owalo stressed the importance of benchmarking against global best practices to ensure sustainable growth and maintain competitiveness in the industry.
KPC is actively diversifying its operations beyond petroleum transportation. The corporation is expanding its fiber optic cable network, enhancing the Morendat Institute of Oil and Gas, and increasing investments in liquefied petroleum gas (LPG). One of its major initiatives includes facilitating the supply chain for cooking gas in schools, reinforcing the government’s drive to transition educational institutions to cleaner energy sources.
Regionally, KPC is strengthening its export market within East Africa and working to operationalize the Kisumu Oil Jetty, which will provide cost-effective petroleum transportation across the region. The corporation is also pursuing the acquisition and optimization of Kenya Petroleum and Oil Refineries Limited and expanding LPG import handling and storage facilities in Mombasa.
Additionally, KPC has surpassed its annual internship and attachment target, engaging nearly 1,300 young professionals compared to the planned 900. This initiative reflects the company’s commitment to capacity building and skills development in the energy sector.
As KPC navigates both financial success and regulatory scrutiny, Sang has called for government support in budget approvals, particularly for the ‘Buy Kenya, Build Kenya’ initiative. The coming months will be critical in determining the impact of the DCI probe on KPC’s long-term strategy and its role in Kenya’s economic transformation.
