In a recent announcement by the Africa Investment Corporation (AFC), funds exceeding 353 billion shillings ($95.25 million) will be allocated to facilitate the movement of fuel to Uganda using Lake Victoria as a conduit.
As per an AFC statement, a portion of the funds will be utilized to construct two barges intended to ferry fuel from Kisumu across Lake Victoria to Uganda.
The financial support is earmarked for Mahathi Infra (U) Ltd, the operator of the MT Kabaka Mutebi II vessel which has been engaged in transporting fuel from Kisumu to the Bukasa-Bwerenga terminal in Waksio district since last December.
Mahathi Infra (U) Ltd is emerging as one of the prominent players in East Africa’s oil and gas downstream sector, with aspirations to extend its reach to the Rwanda and DRC markets.
The introduction of the two barges on Lake Victoria is anticipated to offer a more streamlined and environmentally-friendly alternative to the conventional trucking method.
The Africa Finance Corporation has indicated that this funding will also facilitate the creation of necessary infrastructure, encompassing 14 petroleum storage tanks, 20 truck loading bays, a jetty, and a parking facility capable of accommodating 50 trucks.
These facilities are projected not only to revolutionize the transportation of petroleum products within Uganda but also to considerably curtail costs, transit durations, and the carbon footprint associated with truck-based transport across the Malaba and Busia borders.
A single barge journey on Lake Victoria is poised to replace the equivalent of 200 trucks that traverse the road daily, effectively eliminating 100,000 truck journeys on the busy East Africa route from Kisumu, Kenya to Kampala, Uganda. This reduction in road traffic is expected to mitigate congestion and minimize concerns such as product adulteration, theft, and accidents.
Furthermore, this initiative will alleviate financial burdens for smaller distributors, enabling them to directly procure products from the Mahathi storage facility and drastically reducing delivery times from a week to instantaneous access.
Samaila Zubairu, President of the Africa Finance Corporation, hailed the provision of these funds as a significant achievement in their ongoing commitment to address Africa’s infrastructure challenges in a sustainable manner.
“Through this investment, we are contributing to the transformation of petroleum transportation in Uganda with a lower-emission alternative that cuts costs significantly, reduces road congestion, and improves mobility and accessibility for people, leading to sustainable economic growth and productivity,” stated Zubairu.
The AFC emphasized that the self-propelled barges are meticulously designed in accordance with stringent international environmental and safety standards to prevent fuel leakage.
“They will decrease greenhouse gas emissions by over 95%, from 172,103 tonnes to 7,692 tonnes of CO2 annually, considering that one self-propelled barge possesses the storage capacity equivalent to 200 trucks and traverses a considerably shorter distance of about 250km over Lake Victoria compared to the 350km road route,” reads a portion of the statement.
Despite attempts by Uganda Radio Network to reach Captain Mike Mukula, Chairman and Shareholder of Mahathi Infra Uganda Limited, for additional insights into the recent funding, these efforts were unsuccessful.
In previous communications with URN, Mukula had affirmed their determination to revolutionize Uganda’s approach to transporting petroleum products.
Prior to Mahathi Infra Uganda Limited’s involvement in the fuel storage and transportation sector, a majority of fuel transportation was reliant on trucks and railways.
Uganda faced a significant fuel crisis at the close of 2021, attributed in part by an investigation by the MPS to the absence of a proficient and bulk fuel transportation system, with Uganda National Oil Company (UNOC) highlighting this shortcoming.”
