During the groundbreaking ceremony of a Ksh300-billion ($2.93 billion) cooking gas plant attended by Kenya’s President William Ruto, Tanzanian billionaire Rostam Aziz, the owner of the plant, made a commitment to providing affordable cooking gas to Kenyans.Â
To achieve this, Aziz plans to construct a 30,000-tonne liquefied petroleum gas (LPG) handling facility in Kenya’s Export Processing Zone in Mombasa through his LPG supply company, Taifa Gas. He intends to utilize innovative technologies to handle imports and the supply chain, with the ultimate aim of lowering consumer prices.
With the LPG handling facility, the Tanzanian businessman, who was named the first dollar billionaire in Tanzania by Forbes in 2013, is gearing up to compete against Mombasa-based tycoon Mohamed Jaffer, whose Africa Gas and Oil Ltd. handles 90 percent of the cooking gas imported for the Kenyan market.
The move is expected to trigger a fierce market battle with oil giants such as Vivo, Rubis, and Total, who are also vying for control of the more than 2.87 million households (or 23.9 percent of Kenyan households) that depend on cooking gas.
During the groundbreaking ceremony of the $2.93-billion LPG handling facility, Aziz emphasized the significance of providing LPG to consumers without any substantial upfront costs.
The Tanzanian business magnate emphasized the critical nature of this initiative, pointing out that current market prices reflect the urgency of the situation.
For instance, in Nairobi, the average retail price of a 13-kilogram LPG container has soared to Ksh3,266 ($25.7), while the six-kilogram container has surpassed Ksh2,000 ($15.76).
Additionally, he highlighted that Taifa Gas, which dominates the Tanzanian market, offers more affordable cooking gas prices than Kenya and is up to 22 percent lower than the global average price.
