Kenya Pipeline Company (KPC) is on the spot again after an audit report revealed that oil marketers and rogue KPC staff could be raking in millions of shillings by selling water disguised as fuel.
According to a report by the Sunday Nation, rogue KPC staff collude with oil marketers and sneak water into the oil pipeline system and later declared as “losses”.
The burden is then passed on to consumers who have to pay higher prices to cover for the “losses” every month.
Ordinarily, the losses should be petrol and diesel but in this case it is huge volumes of water with the consumer bearing the burden.
The paper cited a forensic audit report which revealed that more than a million litres of water passed through the system in just 3 months from March.
Oil marketers then collect diesel and petrol and petrol from KPC leaving behind the water that is then declared as pipeline losses and loaded into the monthly pump prices by the Energy Regulatory Commission (ERC).
The report implicating KPC reads in part that “There were huge amounts of water drained through the period under review without source or time when it came into the system…Possible malice or ill intent by the staff is not ruled out as drainage of water without verification could be abused by fraudulent persons”.
A marketer confided in Nation that the web begins with ships delivering fuel at the port of Mombasa which carry some water as well for cargo balancing purposes.
Part of this water is loaded into the KPC terminals at Kipevu and channelled to other parts of the country.
“The meters there (at Kipevu) just count as long as there is fluid going through it,” said the marketer.
100,000, litres of water was reportedly loaded onto the system in just five hours on May 1.
While KPC Managing Director Joe Sang maintained that it is normal for water to exist in petroleum products since they have “hygroscopic” properties, the confession by the oil marketer and the high volumes of loses put his assertion in question.