Overhead costs dampens Kenya Pipeline full year profits by $600m
The amount of petroleum processed rose by 5 percent to 6.2 billion liters from 5.9 billion liters in 2016.
Pretax profit dropped by Sh600 million in 2017 from Sh12.1 billion ($121m) in 2016 to Sh11.5 billion ($115m).
The company has attributed the loss to increased overhead costs.
The Kenya Pipeline Company says it faced increased direct expenses of Sh330 million ($3.3m) attributed to legal settlement with Triton, reconstruction of the old Mombasa/Nairobi pipeline and paying union arrears amounting to Sh500 million ($5m)
However, the amount of petroleum processed rose by 5 percent to 6.2 billion liters from 5.9 billion liters in 2016.
This was attributed to improved flow due to the refurbishment of the of the old Mombasa/Nairobi pipeline.
Kenya Pipeline is currently undertaking a number of projects aimed at streaming the company’s revenues.
Two LPG storage facilities in Nairobi and Mombasa with a total storage capacity of 30,000 tons of gas, rail and truck loading and bottling facilities constructed at a cost of Sh12.5 billion ($125m) will commence in October this year and is expected to be put into use in the year 2020.
Already KPC has signed a lease agreement with the Kenya Petroleum Refineries Limited to convert its facilities at Changamwe for storage of crude oil.
Ongoing construction of the new 20 inch diameter pipeline that seeks to compliment the old system is also set be completed in the last quarter on this year.
The new pipeline is expected to meet the country’s petroleum demand for 26 years.
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