Toyota Tsusho puts a $5b bid for Lamu-Juba oil pipeline

By Jackson Okoth

Japan-based Toyota Tsusho Corporation has placed a $5 billion bid to construct an oil pipeline linking the proposed Lamu port in Kenya with Juba in South Sudan.

This huge infrastructure project, which involves participation of the governments of Kenya, Uganda, South Sudan and Ethiopia, is considered one of the flagship projects under Kenya’s Vision 2030 development blue print.

‘We have already placed our bid for this massive project that will also involve construction of an oil refinery, power stations, jetties and other infrastructure facilities,” said Dennis Awori, Chairman-Toyota Kenya Ltd.

He spoke yesterday during the signing of a memorandum of understanding (MoU) between Toyota Tsusho Corporation and the Kenya Vision 2030 delivery board.

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Toyota Tsusho Corporation becomes the latest addition to a list of global multinationals that have already signed MoUs with the Vision 2030 secretariat, including US-based General Electric, which is to supply spare parts to manufacturing industries. IBM has also signed a deal to set up a tech laboratory in Kenya, to serve the East African region.

“The signing of this MoU is yet another signal that Vision 2030 is not a Government project but also the private sector, complete with a list of some of the largest global partners,” said Mugo Kibati, Director General-Vision 2030 Delivery Board.

Tsusho Toyota and Vision 2030 teams will collaborate in the automobile, power and energy, petroleum, mineral resources, infrastructure and mechanised agricultural fields. Both units will form project teams within each of these business fields.

“We have begun building the Ol Karia one and four geothermal power plants and have put in a strong bid to build the Lamu Juba pipeline with possible branches to Uganda and Ethiopia,” said Kuniaki Yamagiwa, Managing Director Toyota Tsusho Corporation.

Toyota Tsusho Corporation, the investment arm of Toyota Motor Corporation, has over 65 per cent of its business in the automotive industry while the rest is in power and parts business.

“We intend to go big into export of food products, medical equipment and pharmaceuticals, renewable energy and infrastructure,” said Awori.

China was the biggest buyer of South Sudanese oil before the shutdown, and Chinese state firms are the biggest oil operators in the world’s youngest country.

In January, South Sudan signed an agreement with Kenya to build the pipeline to connect its oil fields with Lamu, which is under construction.

The pipeline could also transport crude from Kenya’s Turkana area, where British explorer Tullow Oil found oil deposits in March.

“We believe from the indications that we’ve been given that we if we are lucky we might have as much oil as (South) Sudan. Any extra that we don’t use in the country we are going to put in the same pipeline as the Sudanese oil and export it through the port of Lamu,” said Murungi.

Murungi said the country is also planning to build a second refinery in the northeastern town of Isiolo to produce up to 100,000 barrels per day and refine crude from Turkana.

Kenya already has another refinery near the port of Mombasa, processing 1.6 million tonnes of crude a year.