• Thursday, 04 July 2024
Uganda sues Kenya over oil importation deal

Uganda sues Kenya over oil importation deal

The Ugandan government has sued Kenya on the recent stalemate over the importation deal of petroleum oil from Mombasa port.

This after Kenya declined a request to have Uganda National Oil Company (UNOC) register as an oil marketing company locally to use Kenya Pipeline Company (KPC)'s network for handling and transporting fuel headed to Uganda.

In an application filed at the East African Court of Justice, Uganda through its Attorney General accuses the Kenyan government of placing unrealistic restrictions to access Kenya's pipeline system to transport its petroleum products from the Port of Mombasa.

Uganda also accuses Kenya of breaching various articles establishing the EAC Treaty and the Protocol for the Establishment of the East African Community Common Market.

The landlocked country says in reference to the EAC that it does not require a license from the Energy and Petroleum Regulatory Authority (EPRA) to access the KPC system to transport petroleum products.

The neighbouring country further accused the Kenyan Attorney General of restraining the Energy and Petroleum Regulatory Authority (EPRA) from issuing Uganda National Oil Company (UNOC) with a licence for the importation of oil from Mombasa to Uganda.

The country seeks several declarations including that restrictions placed by EPRA and a court order obtained from the High Court in Kenya, late last year, blocking the regulator from issuing the license to UNOC, contravene articles establishing the EAC Treaty.

"A declaration that the Republic of Kenya shall accord unconditionally, to UNOC, a service supplier of the Republic of Uganda commercial terms for the use of the Kenya Pipeline Company system no less favourable than it accords to like service suppliers of other partner State or any third party,” the reference stated.

The neighbouring country also wants a declaration that the action of the Republic of Kenya prohibiting the grant of any waiver of the licencing requirements for the Licence to it contravenes Articles of the Treaty for the Establishment of the East African Community and Articles 3(2),4(2)(a),5(1), 18 and 38 of the Protocol.

"We import approximately 90 per cent of its refined Petroleum products through the Port of Mombasa in Kenya and the products are transported to Uganda using the pipeline owned and operated by the Kenyan Pipeline Company Limited (KPC)," Uganda AG states in the lawsuit papers.

Uganda contends that the importation and supply of refined petroleum products into its country has traditionally been handled by the Oil Marketing Companies (OMC) operating in Kenya through the Kenya Open Tender System (OTS) and subsequently through the Government-to-Government arrangements between Kenya and foreign Governments, that Kenya adopted in early 2023.

Under the arrangement, OMCs operating in Kenya import petroleum products and in turn, sell the same products to Uganda's OMCS.

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