A proposed agenda for new Energy cabinet secretary

Workers at an oil rig in Turkana County. The discovery and subsequent extraction of oil and gas in Kenya is a boost to the energy sector which however requires reforms to streamline operations. PHOTO | FILE 

By GEORGE WACHIRA

In Summary

• Most urgent on his to-do list is to push Energy, Upstream Petroleum Bills through the legislature and get them signed into law.

I am sure the energy and petroleum stakeholders will join me in welcoming the nomination of Senator Charles Keter to the position of Cabinet Secretary (CS) for Energy and Petroleum.

Mr Keter is not new to the ministry as he served as an assistant minister in the same ministry in the last government. Further, his experience as a previous MP and a senator will be an added advantage in the political management of the energy and petroleum affairs.

The splitting of the ministry into two departments (Energy and Petroleum) with two separate Principal Secretaries is a welcome reform.

Previously electricity issues were perceived by many as receiving more attention and priority compared to petroleum. This separation of accountability and responsibility will certainly improve focus and effectiveness in the management of both energy and petroleum sub-sectors.

We also wish to welcome the new principal secretary for Petroleum, Andrew Kamau who is not new to the this sector.

Here then is my list of issues that I feel the cabinet secretary and his two principal secretaries should prioritise with a view to making a major difference to the energy and petroleum sectors and in so doing to the entire economy.

The most urgent agenda for Charles Keter is to push the two Bills (Energy and Upstream Petroleum) through the legislature and get them signed into laws.

Once passed, the two laws shall be operationalised into facilitative institutions and regulations that should unleash numerous potential opportunities.

In the upstream oil and gas area, monetisation of the discovered oil in Turkana is amost pressing issue. Investors are not likely to sign off their final investment decisions on oil production development until decisions and commitments are made on the export pipeline project.

The CS will therefore be under pressure from various stakeholders to deliver the pipeline project, for only then can we correctly estimate the date of the first oil.

The finalisation of the legal, fiscal and regulatory framework is also equally critical in final investment decisions by investors. Institutional and human resource capacity building in the oil and gas sector is in progress especially under the World Bank funded project. This will require acceleration once the new laws are passed.

In the downstream petroleum sector, the CS will find this area more or less stable with the imports and pricing instruments working fairly well.

The integrity and intentions of the monthly products price formula should be protected at all costs to maintain fairness, transparency and predictability in the downstream petroleum sector.

The ongoing work to rationalise products imports storage and distribution capacity should gradually remove bottlenecks in the petroleum product supply chain.

However, the CS will need to provide early decisions on the institutional status of the Mombasa refinery which has remained vague since the refinery stopped refining in 2013.