(3 Minutes Read)
The tussle between Kenya and Uganda over the importation of Uganda’s petroleum products has moved to the East African Court of Justice (EACJ). Uganda is suing Kenya over her refusal to allow it to use the Kenya Pipeline Company (KPC) infrastructure to move its refined petroleum products from Mombasa port to Uganda under a new arrangement as directed by Uganda’s Cabinet. In the suit, Uganda accuses Kenya of denying its entity, the Uganda National Oil Company (UNOC), the right to operate as an Oil Marketing Company (0MC) in Kenya.
Uganda, through the UNOC, had sought to move fuel products through the Kenya Pipeline but was directed to register as an oil marketer in Kenya by the Energy and Petroleum Regulatory Authority (EPRA), a move that would allow UNOC to import and export petroleum products through Kenya and use the country’s pipeline to do so.
EPRA had asked UNOC to fulfill several requirements, among them; business registration certificates, identification documents for all directors, work permits, tax compliance certificates, proof of financial capability including proof of sales volumes of 6.6 million litres of super petrol/gasoil or A1jet or kerosene in Kenya, evidence of operating five licensed retail stations and operating a licensed depot with a turnover of USD 10 million over the last three years.
UNOC could not provide all the required documents and found some of the requirements a burden, arguing that it was a fully State-owned company in Uganda that only sought to transport products through Kenya and had no intention of doing business in Kenya. It sought exemption, which Kenya said it would consider at the Cabinet level. Uganda, in its suit at the East Africa Court of Justice, holds Kenya’s government responsible for this delay in granting exemptions.
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Uganda currently imports 90% of its refined petroleum products through the port of Mombasa and transports them to Uganda through the Kenya State-owned KPC. Uganda’s petroleum products supply has been handled by the oil marketing companies, and through the government-to-government arrangements between Kenya and foreign governments adopted in early 2023 by Kenya, meaning that the OMCs operating in Kenya import petroleum products and in turn sell the same to Uganda’s OMCs.
