Oil demand in the East African region is anticipated to more than triple by 2015, a projection that has prompted Kenya’s state-owned oil marketer National Oil Corporation (NOCK) to boost its reserve capacity.

NOCK said East Africa oil projections indicate that total demand for oil from nine countries — Kenya, Uganda, Tanzania, Rwanda, Burundi, Malawi, Zambia, Eastern Democratic Republic of Congo and Southern Sudan — will go up to 37 million metric tonnes (MT) from 10 million MT in 2010.

Nock said it was on track to build a $100 million offshore jetty which will make it possible for super large vessels to call at the port of Mombasa. Kenya currently relies on one petroleum jetty at Kipevu, which causes delays in offloading oil.

The marketer is seeking to raise between $80 million and $100 million for the project, whose master plan includes a modern storage terminal of at least 300,000 cubic metres.

Kenya’s oil demand is the highest in the region at 5.6 MT in 2010 and is expected to increase to 7.7 million MT in 2020 and 14.5 million MT in 2030.

Increased demand

Tanzania’s demand in 2010 was 2.3 million MT and is estimated to increase to 3.3 million MT in 2015 and 10 million MT in 2030.
Other opportunities for the industry are in the recent oil and gas discoveries in Uganda, Tanzania and Mozambique as well as the emergence of the Republic of Southern Sudan.

“We need big tankers to service the oil exports from these countries and the growing demand in the region,” said Sumayya Hassan-Athmani, NOCK’s managing director.

Tullow Oil, the exploration firm in the forefront of Uganda oil discoveries, estimates reserves of up to 2.5 billion barrels with production expected to start in 2012. NOCK hopes to facilitate storage of such volumes and will undertake competitor analysis of countries in the region that could challenge Kenya in this venture.

However competition seems to emerge from home as competitor oil company Kenokobil on the other hand was preparing itself for a take over by a foreign company according to its officials.

Jacob Segman, Kenol Kobil’s managing director said its acquisition of an oil terminal in the Democratic Republic of Congo is a highway to its expansion along the east African coast in the hope of becoming a takeover target for an Asian or Middle Eastern firm.

The Company seems to be positioning itself for a possible lucrative business deals amidst oil discoveries in Uganda and DRC.

As Kenol Kobil seeks an acquisition for a stronger footprint, NOCK said it would seek a public private partnership to raise funds for an Offshore jetty and additional storage to transform Mombasa into a major petroleum hub for the growing market.

NOCK seeks to raise between $80 million and $100 million for the plan and the tendering process would be ongoing for the next six months.

The off shore-floating jetty would accommodate larger vessels to feed the high demand from importing countries and the anticipated exports. The facility will allow berthing of vessels of up to 280,000 tonnes compared to the current 80,000 tonnes and the anticipated 120,000 tonnes after the ongoing dredging process.

The master plan includes a modern storage terminal of at least 300,000cubic metres hoped to ease congestion at the port.

Te developments come at a time Southern Sudan is considering an option to connect to a pipeline in Kenya as an alternative compared to paying the $32 per barrel fee that Khartoum has demanded for future use of its oil facilities by the South.