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Uganda Sues Kenya over Oil Importation Deal

Storyline:Business, World

GOOBJOOG NEWS | KAMPALA: Ugandan has sued Kenya over the importation deal of petroleum oil from Mombasa port.

In an application filed at the East African Court of Justice, Uganda claims that the Kenyan government has restrained the Energy and Petroleum Regulatory Authority (EPRA) from issuing them with a license for the importation of oil from the Port of Mombasa in Kenya to Uganda.

Uganda also claims they import approximately 90 per cent of its refined Petroleum products through the Port of Mombasa and the products are transported to Uganda using the pipeline owned and operated by the Kenyan Pipeline Company Limited (KPC).

The landlocked country says the importation and supply of refined petroleum products into Uganda 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.

“The complete reliance and dependency on Kenyan OMCs to import and supply petroleum products to Uganda have exposed the Republic of Uganda to supply vulnerabilities resulting in an avoidable increase in fuel pump prices,” Uganda states in court documents. 

The East African country further stated that it was within its rights to import oil through the Kenya Pipeline Limited Company (KPA) pipeline systems as agreed in the government-to-government oil deal signed by Kenya in 2023.  

Museveni had in November 7 accused Kenyan middlemen of inflating fuel prices, demanding that Uganda be certified as an Oil Marketing Company (OMC) in Kenya. 

In December 2023, Uganda threatened to import fuel with or without the importation license.