Project preparation works for Lokichar-Lamu Crude Oil Pipeline are almost complete with the conclusion of Front End Engineering Designs and submission of Environmental and Social Impact Assessment report to National Environmental Management Authority (NEMA).
The land acquisition process is currently going on with the construction expected to begin in 2021, LAPPSET Corridor Development Authority announced tweeted this week.
The Lokichar to Lamu Crude Oil Pipeline (LLCOP) is being developed by a consortium of the Government of Kenya and international oil companies developing the oil resources in the South Lokichar basin in Turkana.
The LLCOP will transport crude oil from South Lokichar to the coast at Lamu for export. The pipeline will be buried to minimise disruption to land users and wildlife.
Originally, Kenya partnered with Uganda to export Kenya oil through a joint pipeline to Port Lamu on the Indian Ocean coast and when the former retracted from the deal in favour of Tanzania, the latter announced it would build its own pipeline from Lokichar to Lamu.
In November 2016, the British oil conglomerate, Tullow Oil Plc, indicated that it would sign an agreement with the Government of Kenya, before the end of 2016, which would have paved the way for the construction of the Kenya Crude pipeline.
At the time, in 2016, it was expected that the construction of this pipeline would commence in 2018 and last until 2021. The construction cost was budgeted at Sh 210 billion. The pipeline would carry up to 120,000 barrels of crude oil per day.
In order to become a transportation and commercial hub for the region, the LAPSSET corridor concept paper noted Kenya would have to, at a minimum, develop: (a) a commercial port of international standards capable of handling high volumes of containers and other goods traffic; (b) a free trade zone along with the port to foster the growth of trade and commercial activity to make the area into a commercial hub; (c) a new beach resort city having facilities of international standards for native and international tourists; (d) an airport capable of being an air hub for the region; (e) a railway network to enable movement of goods from at the port and the free trade zone to other parts of Kenya and the countries of the region; and (f) a road highway network to support the capacity of the railway network and provide for greater movement of goods into more areas.
The first three of the proposed 32 berths of Lamu port are almost ready for use. The launch was planned for December last year with a Danish based container shipping line- Maersk- indicating that it would call at the facility loaded with transshipment cargo.
The 505KM LAPSSET highway from Isiolo to Moyale was completed over 4 years ago and has significantly transformed transportation enabling faster and cost-effective movement of goods and people along the new corridor.
This is expected to be connected to Lamu via the 536KM Lamu – Garissa – Isiolo highway hence interconnecting the region, spurring regional trade and enhancing economic development.
Though this project has not commenced, detailed engineering designs are complete and negotiations for funding and construction of the same between Kenya and financiers have been going on. In addition, the World Bank approved a 500 Million USD loan for the construction of the section from Lokichor and Nakadok ultimately linking to Juba South Sudan, Kenya Ports Authority told Freight Logistics early this year.
“It is also worth to note that the land survey and inspection of the corridor has been finalized and a compensation process shall be concluded to enable the contractor to mobilize and commence works,” KPA responded in an email query earlier.
Apart from the construction of the first 3 berths, Lamu port has already been connected to the national power grid. Lamu-Garsen route is already undergoing construction while Garsen- Moyale route is being rehabilitated
With a natural depth of 18 months, transshipment business should now be a key area of focus to keep Lamu port busy.
The other option for making LAPPSET corridor valuable is for counties it traverses to leverage on the project and open up their economies. The Government’s LAPSSET Corridor Development Plan has already divided the Northern Eastern region into nine growth areas; Lamu Growth area, Garissa-Bura growth area, Wajir growth area, Moyale growth area, Lokichogio growth area, Turkana growth area, Isiolo-Meru Archers Post growth area and theMwingi growth area.
Each of the growth areas has an identified set of economic activities and investment opportunities that are set to spur economic growth of the area and the Northern Eastern region. These include Isiolo-Meru area being a logistics centre along the corridor and a resort city; Moyale, Wajir and Garissa-Bura growth areas mainly for the set-up of Export Processing Zones for livestock and animal by-products.
Directly related to the Port is the potential of Isiolo, Lokichogio and Moyale for the set-up of Inland Container Depots, which may increase the transport efficiency, and facilitate cross-border trade with neighboring countries that will be linked by the LAPSSET.
It is expected that public sector resources will be sourced to develop physical and social infrastructure to facilitate investment. To achieve such accelerated integrated development, the government should ensure that enabling business environments that foster investment exist.
