Tanzania’s current gas exploration and mining is billed to be at the top of agenda, as Kenya is being ranked a major oil exporter before the year 2020. The event (June 14 – 15, 2018) at the Intercontinental Hotel will also celebrate its fifth anniversary as the most prestigious oil and gas summit in East and Central African region. The Summit will significantly address onshore oil discoveries in Uganda and Kenya and offshore gas discoveries in Tanzania and Mozambique, developments that have made East Africa a subject of intense interest among the global energy industry. “The speed at which governments in East Africa are developing hydrocarbon reserves is a clear indication of their will to cement the region’s reputation as the new hotspot in hydrocarbon exploration and production,” reads a statement from the Summit organisers dispatched to Arusha last week. President John Magufuli has since ordered that exploitation of natural gas begin “as a matter of urgency” while Kenya’s President Uhuru Kenyatta announced his government’s plans to bring forward the country’s oil production deadline by two years and ‘set a path’ that would enable the country to become a major producer and exporter by 2019. The Early Oil Pilot Scheme (EOPS) Agreement between the Joint Venture Partners and the Government of Kenya was signed on March 14, 2017, allowing all EOPS upstream contracts to be awarded. The EOPS production of 2000 barrels per day is expected to commence around the end of the year. “Africa Oil Corporation is society and...

Kenya has embarked on the task of upgrading its newly-built standard gauge railway (SGR) line to electric status following the signing of a financing deal with a Chinese company. The Kenya Electricity Transmission Company (Ketraco) signed the $240 million with China Electric Power Equipment and Technology Company on January 25, paving the way for work to begin. The task is to convert the line from its current diesel-driven status to an electricity-driven line — enabling it to make a switch to use of clean energy. About 14 power substations will be constructed to serve the Mombasa and Nairobi segment of the line which is expected to run through Uganda into Rwanda. Ketraco’s task is to ensure reliable and sufficient supply of electricity not only for the train but also other facilities along the Mombasa-Nairobi economic belt such as train stations, factories and businesses near the railway. It is expected to create a market for major power consumers along the railway line and open other opportunities for the locals. Technically, SGR is ready for the upgrade because though initially designed to run on diesel-powered locomotives, it allows addition of a single electric line that will be connected to Ketraco’s 482-km 400kV Mombasa-Nairobi transmission line. The line, which is the longest and highest voltage transmission infrastructure in East Africa, has a transfer capacity of 1,500 megawatts, which is only 200 megawatts shy of the current national demand of 1,700 megawatts. The line was constructed to address the challenges of low voltage, high...

Mombasa tea auction will be automated by the end of the year, bringing to an end the old manual system that has been in use for decades. East African Tea Traders Association (Eatta) managing director Edward Mudibo said they are currently procuring a software developer, a process expected to come to end by Thursday. Mr Mudibo said the successful bidder will be awarded the contract by March this year to commence the process of automating the world’s second largest auction. “Procurement of software developer has started and is coming to an end this week. We expect the works to start in mid-March with the auction expected to be fully automated by December,” said Mr Mudibo. Trade Mark East Africa (TMA) approved a grant of Sh150 million to Eatta in 2015 for use in automation. The e-auction is expected to improve efficiency and effectiveness of the process used in trading of tea in the African region by developing an automated trading platform that will cut down on the time taken to complete a trading cycle. Source: Business Daily

The Kenya office is the first business presence in Africa. The Nairobi office, which began operations in August 1, 2017, offers a one-stop service from procurement logistics, optimizing logistics required in product manufacturing processes, to distribution logistics. Nippon Express has been using local agents to export roses and other cut flowers grown in Kenya. The firm says it will be putting in place a structure to meet the needs of customers in Kenya and the rest of East Africa, where continued growth is anticipated, moving into the African market as part of its efforts to further extend its global logistics business. “A standard-gauge railway connecting Nairobi with Mombasa was opened in June 2017 and, with transport by freight train now available, logistics demand is expected to rise due to the reduction in time and cost for transport inland from Mombasa Port,” the firm said in August 2017. The investment comes after the 6th Tokyo International Conference on African Development held in Nairobi in August 2016, where the Japanese government announced its intention to make available a total of Sh3 trillion in both public and private investment over the three-year period 2016-2018, prompting a growing number of Japanese companies setting up operations in Africa. Source: Capital FM

The government’s unilateral decision to transport all imports coming in through Mombasa port on the standard gauge railway (SGR) to Nairobi’s inland container depot (ICD) in Embakasi has renewed debate on sustainability of the railway project. Importers who had not specified the final address of their cargo became the first casualties of the directive, which essentially locks out truckers in favour of the SGR. The Kenya International Freight and Warehousing Association (Kifwa) last Friday wrote a strongly worded letter to the Kenya Ports Authority (KPA) management, protesting the purported issuance of a directive forcing its members to use the SGR. “We were shocked to be informed this morning that on government directive your authority has stopped nominations of CFSs from Monday this week and that all un-nominated containers consigned to importers upcountry have to be railed to ICD Embakasi by SGR for final clearance,” Kifwa secretary- general Ahmed Shimbwa, said in a letter to the KPA managing director. “Whilst our association is fully supportive of SGR becoming a success we … must point out that any business given to SGR should be on a voluntary basis i.e. ‘willing buyer willing seller’ and not by force.” It has also emerged that the government has also stopped importers from choosing their cargoes’ destinations going forward, meaning some cargo that is not meant for inland transport could end up in Nairobi at the importer’s cost. Phase One of the SGR, which covers the Mombasa-Nairobi section is being built at a cost of Sh447...

The Kenya Electricity Transmission Company Limited (KETRACO) signed a contract worth $240M with China Electric Power Equipment and Technology Company Limited (CET) on the 25th of January, 2018. This contract will result in the electrification of the SGR rail line that is currently powered by diesel. The project involves construction of 14 substations between Mombasa and Nairobi. The main purpose of this venture is to ensure that when the SGR switches to clean energy power source, the supply will be reliable and sufficient for not only the train but other facilities along the Mombasa-Nairobi economic belt including train stations, planned industries, factories and businesses near the railway. This will create more major power customers and consumers and bring other opportunities to the locals. The design of the SGR railway, initially run by diesel-powered locomotives, allows for the addition of a single electric line that will be connected to KETRACO’s 482km 400kV Mombasa-Nairobi Transmission Line (MNTL) that was energized by President Uhuru Kenyatta on the 4th of August, 2017. MNTL, the longest and highest voltage transmission infrastructure in East Africa, has a transfer capacity of 1,500MW which is 200MW shy of the current national demand of 1,700MW. The line was constructed to address the challenges of low voltages, high transmission losses, unreliable supply including strengthening of network security and the national grid system. Its energization therefore debunks as flawed the myth that Kenya does not have a dependable source of electricity, most importantly one that can power the electric train network....

Tanzania and its northern neighbour Kenya have agreed to end their trade dispute, a move that is bound to increase intra-trade within the East African Community (EAC). The agreement bodes well for unity and development of the two countries, and we applaud both governments for realising the significance of removing trade barriers within the six-nation bloc. The dispute saw Kenya banning cooking gas and wheat imports from Tanzania, while the latter blocked Kenyan milk and tyres from entering its territory. If nothing else, the row was making a mockery of the efforts which the countries had put into enhancing regional integration. Trade between Tanzania and Kenya constitutes over 45 per cent of the entire trade within the EAC. Thus - considering the relatively huge trade volume between the two nations - it is our belief that the differences will not take long to be ironed out once and for all. This is for the good of both countries in particular and regional integration in general. Key issues discussed during the meeting ranged from how to resolve multiple levies and other charges; lack of preferential trade arrangements; the need for standardised inspection fees; delays at border checkpoints; slow customs procedures at border crossings and slow implementation of relevant EAC directives. Private sector representatives from the two countries made presentations highlighting trade and investment opportunities in aviation, mining, petroleum and transportation - among many more - which the two countries agreed to pursue as soon as the current trade barrier issues are...

East African countries are leading in implementing Africa's agricultural transformation policies. According to a report on the Malabo declaration, Southern Africa comes second. The declaration is a set of agricultural goals that Heads of State attending the African Union Summit in Malabo, Equatorial Guinea in June 2014 adopted, to be attained by 2025. The Africa Agricultural Transformation Scorecard tracks progress in commitments made by governments. East Africa managed an average score of 4.20, which indicates it is on track to meeting its commitments when assessed against the 3.94 benchmark for 2017, with five out of the eight regional countries that submitted their progress to the AU, managing the minimum 3.92 score. Rwanda was ranked the best agriculturally transformed country in Africa with a score of 6.1, thanks to political and institutional reforms. Burundi scored 4.7, Ethiopia 5.3, Kenya 4.8 and Uganda 4.5, to cement the region's 4.2 score ahead of the Southern Africa region which scored 4.02, and Northern, Central and Western Africa which scored 3.83, 3.62 and 2.35 respectively. Speaking at the launch of the scorecard, Ethiopian Prime Minister Hailemariam Desalegn asked the seven countries that did not submit their reports to do so in the next review in 2020. Source: All Africa

Kenya is heading back to the drawing board after its six-year attempt to promote the duty-free export of coffee, tea, cut flowers, food ingredients and home décor failed to boost its US trade volumes. Textile and apparel products, which have dominated exports under the African Growth and Opportunity Act (Agoa) since it was enacted in 2000, remain the main items in Kenya-US trade, defying efforts made at product diversification over the 18 years. Increasing trade volumes and range of products are some of the grounds that Kenya used to successfully push for a 10-year Agoa extension, now open up to 2025. “Kenyan exports are dominated by textiles and apparel,” reads in part the findings of a review of the current strategy undertaken by the national committee on Agoa. “Clothing for men and women as well as apparel fabrics articles constituted a huge export volume base totalling to at least 65 per cent of the total goods exported in the year 2016.” Trade ministry data shows that value of exports to the US grew to Sh55.billion ($ 551.5 million) in 2016. The Agoa window provides duty-free market access to the US market for 6,421 product lines to eligible sub-Saharan Africa countries, among them Kenya. Since then, there have been four extensions of the programme in August 2002; July 2004; December 2006. The last, in June 2015, extended Agoa for a further 10 years to 2025, including third-country fabric provisions. In 2012, the Trade ministry teamed up with US Agency for International...

The Kenya Ports Authority (KPA) has approved the acquisition of 7.5 acres of land for the expansion of the inland container depot (ICD) in Embakasi in readiness for higher cargo capacity under the standard gauge railway. KPA general manager for engineering services Joseph Atonga told the Business Daily that the move is aimed at adding more capacity on the Sh22 billion facility that was launched by President Uhuru Kenyatta last December. “As cargo volumes grow, the current ICD is going to be congested and it will become small. So as time goes by, there will be need for additional capacity and that is why we are acquiring 7.5 acres of land at ICD for future expansion,” he said. “The current market price of land in that area is about Sh80 million per acre. We will, however, negotiate with the owners for a better price.” The ICD has a cargo handling capacity of 180,000 20-foot total equivalent units (TEUs) per annum, which will be expanded to 450,000 TEUs. The facility has, however been starved of cargo since it was launched. Mr Atonga said that teething problems raised by cargo owners such as price had been addressed, adding that the SGR would soon be the  preferred mode of transport by cargo owners. He noted that the piece of land expected to be developed before December will also be used for handling cargo staying at the facility for a longer period. Under this arrangement, cargo owners will be charged a specific amount for storage for...