UK oil firm sues KPC over Sh3 billion oil
By Nancy Akinyi
A UK-based oil firm is still pursuing Kenya Pipeline Company (KPC) over oil valued at Sh3 billion allegedly released from the Kipevu Storage Facility two years ago.
Glencore Energy UK Limited says more than 31,700 metric tonnes of its gasoil was released from the said facility without its authority.
The firm now wants a declaration that it is entitled to the same quantity of gasoil out of the total stocks held by the State corporation.
Alternatively, it wants the court to order KPC to give immediate delivery of the gasoil in question or pay the value of the oil, which now stands at more than Sh3.2 billion.
The firm flew in two witnesses from London.
The first witness to stand before Commercial Court Judge Murugi Mugo was Mr James Philip, who is in charge of jet oil trade.
Led by advocate George Oraro in his evidence, Philip took the court through a number of correspondences between his company and the corporation.
He told the court that to date KPC has not explained how his company’s stock converted to nil from 31,752.38 metric tonnes.
The court heard that as at December 31, 2008, KPC was still holding the said gasoil, but to date no explanation has been given regarding the release of the said oil to a different company.
But the corporation in its defence has denied owing the said amount of gasoil.
In the defence filed through advocate Githu Muigai, KPC claims that Triton Limited dealt with the gasoil in its then capacity as owner of the products under the Transport and Storage Agreement.
The corporation states that it cannot comply with the demand for immediate return of the gasoil in question because the same was released upon instructions of Triton who retained ownership of the petroleum product stocks before it was placed under receivership.
The suit papers state that following a collateral financing agreement between KPC and Triton, Glencore Limited financed the purchase by Triton of various petroleum products.
In the agreement, the UK based firm would sell the said quantities of petroleum products to Triton, but would retain ownership of the same until the purchase price was paid in full. The suit papers state that the total quantity deposited into the defendants’ storage facility amounted to 72,284 metric tonnes. The hearing continues.
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