What you need to know:
Rail firm was given up to February 2015 to lift its cargo haulage among other things
Kampala- Hass Petroleum Limited, a regional oil marketer and distributor has scooped a Shs385 billion ($148 million) tender to supply diesel to rail operator Rift Valley Railways over the next three years.
The development comes after RVR launched three electric locomotives in Mombasa, part of 20 locomotives meant to boost haulage capacity along the Mombasa-Kampala route.
Hass Petroleum was awarded the contract after edging out five other distributors.
Under the agreement, Hass Petroleum will provide RVR with an estimated 130 million litres of automotive gas oil (diesel) over a period of three years (the equivalent of over 4,300 fuel tank loads) to RVR’s key operational centres in Uganda and Kenya.
Speaking during the contract signing ceremony at RVR’s offices in Nairobi, RVR chief executive officer Carlos Andrade said: “The 20 American-built locomotives we are acquiring over the next five months in addition to the five we are refurbishing locally will double our cargo haulage capacity and increase our diesel consumption needs by 65 per cent this year alone.”
He said diesel consumption is expected to rise each year of the contract period with further increases in the locomotive fleet.
“We are happy to have won this contract emerging with the best bid amongst our peers. This is yet another major milestone by Hass Petroleum Group and not only does it articulate the strength and market position of Hass Petroleum but is also shows the confidence,” Mr Abdirizak Ahmed, the Kenya country manager for Hass Petroleum said, adding that RVR enjoys a good working relationship with the company.
A service level agreement requires Hass Petroleum to manage fuel facilities and ensure minimum stock levels in RVR’s operational hubs of Kampala and Tororo, and in Changamwe, Eldoret and Nairobi in Kenya.