| dc.description.abstract | The Kenya Pipeline system is the both the legal and more cost effective way of
storing and transporting petroleum products in Kenya. The five major oil
companies and the rest of the oil industry rely on the Kenya Pipeline Company to
store and transport their fuel stocks to the western Kenya depots for export to the
great lakes region. However, KPC's inadequate capacity to store and transport
as much fuel as the market demands has been a big hindrance to the realization
of these major companies' export potential to the region.
The study sought to determine the magnitude of lost export business and how
the oil Muttinational Companies have responded to this challenge of inadequate
transportation and storage capacity at KPC.
The study was based on primary data, which was collected using a questionnaire
and personal interviews. The data obtained was then analyzed and interpreted
using content analysis and descriptive statistics.
The findings of this study revealed that the oil companies lose out an average of
53% of their export business due to KPC related problems. Thus KPC does not
avail all the volume that the oil companies need to export and the oil companies
rated their performance as poor. The oil companies indicated that they are now
operating a suppressed demand and customers have had to condition
themselves to the volumes they can provide.
In response to this, they have had to rethink alternative storage and transport
modes of rail and road. However, the cost implication of these alternative modes
far outweighs the use of the Kenya pipeline system. Were the KPC system
reliable, it would be the Oil Companies' preferred mode of transportation.
It is thus recommended that the Kenya Pipeline Company would address the
current capacity crisis with speed, and proactively anticipate similar challenges
that may be faced in the future in view of the fact that the demand in the region is
still expected to grow as the various governments continue to reconstruct the
economies. | en |
