Product Oil Pipeline

The Product oil pipeline is one of the 7 key infrastructure projects planned under the LAPSSET corridor projects list. The project runs from Lamu – Isiolo – Moyale – Addis Ababa (Ethiopia), a distance of approximately 790 Kms. Considering that Kenya and Ethiopia are connected through road infrastructure, it might be strategic to fast track the construction of a product Pipeline connecting to Ethiopia which to-date does not have a product pipeline whose development is still at planning stage. Even though Ethiopia plans to build a product pipeline connecting to the Djibouti Port, Kenya still has the larger southern Ethiopia market which is the effective Kenyan Market to be served through the Port of Lamu. Djibouti Port is therefore effective for Northern Part of Ethiopia while Lamu Port is effective for Southern parts of Ethiopia which also happens to be the Ethiopian government’s zone for investment focus. To commence and actualize this, LCDA held a meeting with the Ethiopian State Minister of Mines, Petroleum and Natural Gas (MoMPNG) during which it was agreed that a Bilateral Agreement be drafted and negotiated to provide a framework for implementation of this project. Initial bilateral discussions took place culminating in the signing of a Memorandum of Understanding (MoU) between the Government of Kenya and Government of Ethiopia on Oil and Gas. A bilateral agreement on the development of the pipeline together with other LAPSSET components between Kenya and Ethiopia was signed in May 2018. A process to establish a technical team led by the Kenya Pipeline Corporation (KPC) to carry out detailed feasibility studies and eventual investment decision started in June 2019.