Shipping petroleum to reduce fuel prices by over 30%

The Uganda Revenue Authority (URA) has said shipping petroleum products from Kenya by water will reduce fuel pump prices.

“We are looking are looking at a reduction in transport costs by 30 to 50 per cent. The cost of petroleum transportation is quite high by road with a cubic metre going by $40 (Shs148,000) and yet by ship its $20 to $25 (Shs74,000-Shs 92,000) per cubic metre. The ultimate reduction in costs translates to reduction in the fuel pump prices” explained URA’s acting assistant commissioner in charge of the field services customs department, Geoffrey Balamaga. 

Mr Balamaga remarked on Friday after the maiden arrival of MV Kabaka Mutebi II with fuel from Kisumu to Bugiri, Bukasa, Wakiso district fuel terminal.

“Previously, we have been clearing about 300 to 400 tankers per day at our borders with Kenya at Malaba- Busia.Petroleum dealers will now have to seat down and review accordingly because this facility has reduced the cost of transport logistics,” he noted. 

Mr Balamaga said the maiden trip had a trial test of 1.1 million litres of fuel which in the consequent trips will see the vessels bring in its full capacity of 4.5 million litres of petroleum products.

“Uganda consumes 7 million litres of petroleum products daily. MV Mutebi will address many challenges faced by truck drivers and transport 4.5 million litres of petroleum products that are transported by 150 trucks on the road in just one trip,” he said.

According to authorities, MV Kabaka Mutebi II left Uganda on December 21, 2022 to collect fuel for the first time from Kisumu.

“It set off from Kisumu to Uganda on December 28 with the travel time approximately 17 hours. It reached Uganda at 6:30am on December 29, 2022,” observed  Mahathi infra Uganda Limited project manager Dinesh Donadi.

Mr Dinesh said a terminal in Uganda will become a hub for the trucks that have been transporting fuel from Kisumu to pick it from Bugiri to different parts of Uganda and neighboring countries like Rwanda, Burundi, DRC and South Suda

“By shifting from road to water based transport system, there should be a reduction of 50 percent in the fuel rates,” he remarked on Saturday.

According to Dinesh, the company will commercially launch operations in the second week of January 2023 after the required tests have been completed

For the captain of the vessel, Debashish Kumar, the maiden voyage of the fuel vessel went on smoothly without any hazards from Kisumu to Uganda.

“We will make two trips a week and this is the perfect vessel for this lake. We can go a maximum of 2.5 nots on this lake. We have a depth of 3.5 metres to 4 metres. It is good to have a low depth vessel for this lake,” he said.