Kiraitu takes over as National Oil Corporation chairman, promises turnaround

National Oil Corporation of Kenya CEO Leparan Ole Morintat and Company Secretary Robai Shiakhutsa presents a gift to outgoing Board Chairman Patrick Obath as incoming Chairman Kiraitu Murungi looks on during the handover on May 2, 2023, at the company's headquarters in Nairobi. [Edward Kiplimo, Standard] Kenya needs to produce oil in order to cushion itself from external shocks, National Oil Corporation (NOC) Chairman and former Energy Minister Kiraitu Murungi has said. Kiraitu noted that external pressures such as the dollar volatility and conflicts will always affect energy security, saying internal sources was a sure bet in stabilizing the supply. "You need to produce your own oil because it is what you can control," he said at the NOC headquarters in Nairobi when he took over as chairman from Eng Patrick Obath. Industry experts hope that the appointment of Kiraitu will give the corporation new energy in its turnaround pans. NOC was incorporated in April 1981 under the Companies Act, Cap 486 of the Laws of Kenya with a mandate to participate in all aspects of the petroleum industry. It was founded with a mandate to spearhead petroleum exploration activities in the country, guaranteeing security for supply of petroleum products and stabilizing prices of petroleum products. "NOC was established for the purpose of energy security. NOC still has that relevance. We also have a rich mandate in the upstream sector - exploration and production. You need to produce your own oil because it is what you can control," Kiraitu said. The NOC chairman spoke even as Kenya inches closer to becoming an oil exporter. The Energy and Petroleum Regulatory Authority (Epra) has said it is set to complete its review of the new plan to commercialise the oil in South Lokichar Basin in June. Kiraitu praised the Government-to-Government oil import agreement, saying it helps to stabilize supply and pricing. "I want to thank the President for appointing me even though I was not in Kenya Kwanza during the elections. It shows he has some trust for me in this sector," he said. The former Meru Governor exuded confidence that NOC would rise from its financial challenges saying when the Narc government took over in 2003 its situation was even worse. "When we came in, NOC had only six stations. By the time we were leaving 10 years after they were 70," he said. During his tenure as Energy minister, Kiraitu issued several notices and circulars to that aided the corporation in meeting its mandate. Legal Notice no 43 of 2008 issued regulations guiding the establishment of the strategic petroleum reserves that required NOC to establish and manage strategic petroleum reserves equivalent to 90 days consumption for the country. Legal Notice No. 96 of June 2010 also set aside a 30 per cent petroleum imports allocation quota for the corporation. The Head of Public Service Circular in 2015 also directed al Government Departments and SAGAs to procure petroleum product requirements/demands from NOC. Financial challenges have, however, not allowed NOC to fully execute its mandate. NOC CEO Leparan Ole Morintat said it was befitting that Mr Murungi was now in a position to implement what he had formulated as policy when he was minister. "It was during Mr Murungi's tenure that oil was discovered in Turkana and the ministry attributed the State's 22.5 per cent share in carried interest in the production sharing contract to National Oil." Kiraitu thanked Obath for the turnaround plan he had laid and pledged to implement it. "During the 18 months I have been chairman we have studied and understood what the issues are. We have studied and understood what the issue is. And we have put together a plan that will take the company back to its glory so it can play the role it was created for," said the outgoing chairman.

Kiraitu takes over as National Oil Corporation chairman, promises turnaround

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