The Kenya Petroleum Refineries Limited (KPRL) has scheduled a major valuation of its assets, including land and machinery, ahead of a deal that will see the Nigerian-owned Asharami Synergy build a plant to handle imports of cooking gas.
KPRL said fixed assets to be revalued span various locations, including Changamwe, Kipevu, Shimanzi, and Nyali in Mombasa County and the Kuruwitu/Vipingo area in Kilifi County.
“Undertake verification, reconciliation, and valuation of all fixed assets (movable and immovable as described in the International Financial Reporting Standards) owned by KPRL and update the KPRL assets register to reflect the current open market value, depreciated replacement cost and insurance or replacement values,” it said in a tender call for valuers.
The valuation, whose completion timelines are undisclosed, comes as Asharami Synergy finalises talks with Kenya Pipeline Company (KPC) and the government to fund construction of a Sh17.7 billion cooking gas handling facility on land owned by KPRL in Changamwe.
KPRL became a subsidiary of KPC two years ago and one of the key aims of the acquisition is to set up bulk import handling and storage facilities at the KPRL’s storage tanks in Changamwe, Mombasa.
KPRL last week revealed that it would lease out about 23.19 acres of its land to Asharami Synergy for the LPG facility project for 31 years.
“In the implementation of the Government of Kenya’s liquefied petroleum gas (LPG) growth policy, the government resolved to establish a common user bulk LPG storage and handling facilities of 30,000 tonnes at KPRL through private sector-led initiatives, where the private sector players (PSP) would lease KPRL land to set up the facilities as shall be licenced,” it said in a notice.
“Consequently, KPRL competitively procured a PSP to undertake the project in compliance with relevant legislations and or circulars with respect to lease of public land.” it added.
A blueprint shows that the planned Changamwe common-user facility will mainly receive supplies from pressurised LPG ships berthed at the Sh42 billion newly constructed Kipevu Oil Terminal 2 (KOT-2) jetty.
KPC contracted a giant Pakistani firm; Petrochem Engineering Services to design an LPG import and storage facility in Changamwe, Mombasa.
The common-user LPG facility in Mombasa, once completed, will accelerate the loading of cooking gas for distribution by trucks which will help to cut demurrage or storage costs.
KPC projects that faster loading is expected to translate to lower prices for LPG by 30 percent once operational as oil marketing companies pass the benefits of reduced demurrage costs to consumers.
