Murang’a set for Sh1b gas cylinder production plant
By Moses Michira and Boniface Gikandi | April 4th 2018
A Nairobi-based transporter plans to put up a Sh1.1 billion plant that will manufacture cooking gas cylinders in Murang’a County.
When complete, it will be the third major gas cylinder manufacturer in the country after the more established East Africa Spectre, owned by former Prime Minister Raila Odinga’s family, and Allied East Africa based in Kisaju.
Excellent Logistics Ltd (ELL) Managing Director Fred Ngugi said his firm expects to cash in on a sustained push by the Government to discourage the use of charcoal and firewood.
A consortium of lenders has approved the loans to fund the project, according to the MD, with construction pending the receipt of regulatory approvals.
"Most of the liquid gas cylinders used in Kenya are imported and we are only trying to respond to demand,” said Mr Ngugi Tuesday, adding that the government projects local demand at 20 million pieces. Besides the manufacturing plant, ELL will also construct a Liquefied Petroleum Gas (LPG) storage facility estimated to hold 300 metric tonnes of gas in a move expected to ease supply to Nairobi and Central Kenya regions.
The proposed multi-million-shilling facility will be built in Marema village in Kambiti location on the busy Kenol-Nyeri Highway on a plot formerly registered for agricultural activities.
The facility has the capacity to refill between 14,000 and 15,000 cylinders per day.
ELL has until now been involved in the refilling of empty cylinders for the region, which Mr Ngugi believes are still too expensive for most households, forcing them to opt for cheaper alternatives for their cooking needs.
"We are present in the entire East Africa region and I can confirm there is a huge deficit of gas cylinders which we hope to fill," he said, adding that the factory’s annual production is projected at 1.8 million cylinders.
National Environment Management Authority (Nema) has invited the public to submit comments on an environmental impact assessments study report for the proposed plant within 30 days.
The first public participation forum was held three months ago under the stewardship of area chief Peter Kaaria where the locals raised concerns of a possible air pollution, contamination of their water sources, solid and liquid waste generated from the plant.
The State has rolled out various interventions expected to increase the uptake of cooking gas among poor households, including subsidised cylinders in a pilot programme. Poor households are allowed to buy the cheaper cylinders that are distributed by the State-owned National Oil Corporation of Kenya.
Energy Regulatory Commission projects that the price of gas to households would fall by as much as half, with heavier taxation expected to push more homes from using the dirtier Kerosene.
Cooking gas sellers are also turning to selling variable amounts depending on the spending abilities of the buyers to circumvent the hurdle of getting enough cash to pay for the standard 3kg, 6kg and 13kg cylinders.
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SHIPPING & LOGISTICS