The loss of 11 million litres of fuel by KPC has spilled to Parliament even as the firm’s board holds a crisis meeting today.
KPC lost 11.646 million litres — 5.956 million in spillage and 5.69 million to pilferage between March 2017 and May 2018 in nine separate incidences.
However, oil marketers want cash for loss with the KPC bosses insisting the 11,646,000 litres do not meet the threshold for compensation.
The oil marketing firms petitioned Parliament to compel KPC to pay Sh1 billion over the loss of their products in the hands of the public oil distributing company.
Today the National Assembly committee on energy is scheduled to meet the oil marketing companies, Energy and Petroleum CS John Munyes and KPC MD Joe Sang’ regarding the push and pull over the loss.
The committee chaired by Nakuru Town East MP David Gikaria will seek answers from the KPC management on how the oil was lost as well as listen to the firms’ claims.
The KPC contract with oil marketers protects the corporation from compensating for losses below 0.25 per cent of the total amount of fuel pumped through the pipeline within a period of six months.
However, KPC says it lost only lost 0.15 per cent in the 2017/2018 financial year, which is much lower than the compensation threshold set out in the agreement.
Oil marketing companies importing the product into the country are themselves compensated for ocean loss of up to 0.5% of the cost, insurance and freight (CIF).
The sharply divided board chaired by John Ngumi will use the special meeting today to press the senior managers to explain the loss after another meeting aborted last Tuesday due to a quorum hitch.
“Please take note that the special board or directors’ meeting No.2 of 2018/19, which was scheduled to be held on Tuesday 27, November 2018 from 7.00am, will now be held Tuesday 4, December 2018 from 7.am 5th floor Board Room, head office Kenpipe plaza,” reads the notice of the meeting seen by the Star.
The notice signed by company secretary Gloria Khafafa also indicated that the board will: “deliberate on the article on spillages and pilferage in the Daily Nation Friday November 23, 2018” as part of the agenda of the special meeting.
The Star yesterday established that there was unease at the KPC headquarters with staff questioning why the board had been convened to discuss a news article published by the local daily.
Today’s board meeting, according to the State Corporations Act 2012, is not obliged to raise the two-thirds majority quorum an initial one failed due to a quorum hitch last Tuesday.
Petroleum Ngumi, PS Andrew Kamau and directors Rita Okuthe and Winnie Mukami attended last week’s meeting.
Those who did not turn up were alternate director (Treasury) Erick Korir, directors Jinaro Kibet and Felicity Biriri.
Tension is palpable among senior management staff at the public oil distributor firm amid claims that the board is plotting a far-reaching overhaul targeting the MD.
The Star has established that operations at the Kenya Pipeline headquarters in industrial area, Nairobi, have been affected with most top managers opting a-wait-and-see approach.