• Saturday, 22 June 2024
Kenyans will save money thanks to a Tanzanian gas pipeline.

Kenyans will save money thanks to a Tanzanian gas pipeline.

The Kenyan government has announced plans to expedite the construction of a proposed gas pipeline from Tanzania in order to reduce cooking gas prices.

President William Ruto declared on Monday that the 600-kilometer pipeline that Kenya will use to import gas from Tanzania's Mtwara plant is a priority, putting an end to a year-long delay.

The pipeline, which is expected to cost Ksh132 billion ($1.1 billion), is part of a Memorandum of Understanding on Cooperation in Natural Gas Transportation signed by former President Uhuru Kenyatta and Tanzanian President Samia Suluhu in May last year.

The importation of gas from Tanzania will provide Kenya with another option for lowering the cost of cooking gas.

"We will expedite the gas pipeline from Dar es Salaam to Mombasa and eventually to Nairobi so that we can use the resources that we have to lower energy tariffs in Kenya for both commercial and domestic use," Mr Ruto said on Monday in a joint press conference with Ms Suluhu.

"We will ensure that what the Government of Kenya is required to do is done in a timely, efficient, and effective manner so that we can access the gas resources that you have in your country in the shortest time possible."

The project, which will be funded through a Public Private Partnership (PPP), will allow Kenya to tap Tanzania's vast natural gas deposits, lowering the cost of cooking gas and electricity prices.

The price of a 13-kilogramme cooking gas has risen to Sh3,400, while a six-kilogramme is now selling for Sh1,500, thanks to a global rally in crude prices and the reintroduction of the commodity's 6% VAT.

Kenya reintroduced a 16 percent VAT on cooking gas in July of last year, which, combined with a global increase in the cost of crude, resulted in a surge in commodity prices.

 

After a public outcry, the tax was cut in half this year, but oil marketers have failed to pass the savings on to customers.

Unlike diesel, super, and kerosene, cooking gas prices are not regulated by the government, leaving consumers at the mercy of oil dealers.

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