National Oil to cut gas cylinder fees by 50pc in October

A National Oil petrol station. FILE PHOTO |  NATION MEDIA GROUP

In Summary

• Currently, the deposit fee for a 3kg cylinder is Sh1,200 and 6kg Sh2,750, excluding the charge for cooking gas. Gas refilling is Sh990 for a six-kilogramme cylinder and Sh510 for a 3kg one.

National Oil Corporation stations will offer first time gas consumers a 50 per cent cut in cylinder deposit prices from October in a fresh effort by the Energy ministry to wean households of dirty fuel sources.

The ministry hope that cutting deposit paid for 3kg and 6kg cylinders of the SupaGas brand, belonging to National Oil, by half will benefit mostly low income households who currently rely on firewood, charcoal and kerosene for cooking. The campaign will see the cost of a 3kg cylinder drop by at least Sh600 while a 6kg tank Sh1,000.

“We will charge less deposit fees to favour poor homes who are disadvantaged by high upfront costs,” Petroleum Principal Secretary Andrew Kamau said in an interview.

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“We are looking at reducing the fees to between 50 and 40 per cent in October from the current 100 per cent.”

The government will stockpile new cylinders at stations in the period to October, paving the way for the subsidies to take effect.
This comes as a big relief to low-income households.

Deposit fees

Currently, the deposit fee for a 3kg cylinder is Sh1,200 and 6kg Sh2,750, excluding the charge for cooking gas. Gas refilling is Sh990 for a six-kilogramme cylinder and Sh510 for a 3kg one.

The 13kg cylinder, popular with the middle class, will continue to attract the full deposit of Sh3,950. The Energy Regulatory Commission (ERC) reviews deposit fees every three months to match dealers’ costs in acquiring them.

Dealers accept cylinders from rival brands, enabling consumers to conveniently refill gas at the competitors' stations. Statistics show that about 70 per cent of Kenyan households use kerosene for cooking. National Oil is eighth in the cooking gas market share at 3.7 per cent.

Total is the market leader at 21 per cent, followed by Hashi (19.6pc), KenolKobil (11.8pc), Vivo (11.1pc), One Petroleum (11.1pc), Oil Libya (10.3pc) and Oryx Energies (4.8pc).

notuki@ke.nationmedia.com