Rwanda has operationalised bulk petroleum importation through Rwanda National Energy Company Ltd (RNEC), using Tanzania's Port of Tanga and Kenya's Port of Mombasa to strengthen security of supply and diversify import routes. ALSO READ: Rwanda-Kenya energy deal: 40,000-tonne maiden petroleum cargo arrives at Mombasa According to the Ministry of Trade and Industry, RNEC has received three bulk petroleum shipments totalling approximately 120,000 tonnes—the first two, each of about 40,000 tonnes, through Tanzania’s Port of Tanga in July and August, and the third through Kenya’s Port of Mombasa in September. ALSO READ: Rwanda-Kenya fuel deal to help shield economy from global shocks Officials said the use of both Tanga and Mombasa corridors is intended to strengthen Rwanda’s energy supply resilience, logistics flexibility and continuity of petroleum availability in the domestic market. ALSO READ: Rwanda, Kenya sign deal for petroleum importation through Northern Corridor In an interview with The New Times, Doreen Ntawebasa, Director-General of Trade and Investment in the Ministry of Trade and Industry, explained what the deals mean for the country and how RNEC’s direct importation model affects existing private petroleum importers. What are the benefits of the new arrangement? The benefit of the new arrangements is that Rwanda can now procure bulk petroleum products directly and move them through both the Tanzania/Tanga and Kenya/Mombasa corridors, providing more predictable replenishment and reducing dependence on a single supply route. The new bulk petroleum import arrangements should primarily be understood as strengthening Rwanda’s security of supply and diversifying supply routes, rather than directly increasing the country’s physical storage capacity. A typical RNEC cargo of approximately 40,000 metric tonnes represents roughly 50–52 million litres of petroleum products, depending on the product mix and density. However, these volumes do not in themselves create additional storage capacity. Physical reserve capacity only increases when new storage tanks or depots are commissioned. Where do the agreements with Tanzania and Kenya deals leave oil importers? Under the current arrangement, Rwanda National Energy Company Limited acts as the bulk importer and aggregator; it does not directly retail the imported petroleum products to petrol stations. Licensed Oil Marketing Companies (OMCs) submit their product requirements to RNEC. The available cargo is allocated among participating Licensed Oil Marketing Companies, which then uplift their allocated volumes and transport them to Rwanda for distribution through their existing depot and retail networks. Therefore, the arrangement maintains the important role of existing petroleum companies in storage, inland transportation, distribution and retail, while Rwanda National Energy Company Limited coordinates bulk international procurement and supply. The new model mainly changes how Rwanda procures petroleum products internationally, rather than removing private Oil Marketing Companies from the petroleum value chain. Rwanda National Energy Company Limited is being positioned as the Government’s central vehicle for bulk petroleum procurement and supply management. The agreements with Tanzania and Kenya provide Rwanda with structured access to port, storage and transportation infrastructure, while licensed Rwandan Oil Marketing Companies continue to play a central role in taking up the imported products and distributing them to the domestic market. The direction of the bulk purchase programme is therefore to move from fragmented international sourcing towards coordinated bulk procurement through Rwanda National Energy Company Limited, while maintaining the participation of private Licensed Oil Marketing Companies downstream. How is the bulk purchase arrangement being implemented? The bulk purchase arrangement is being progressively implemented through Rwanda National Energy Company Limited. Any requirement for all petroleum imports to be channelled exclusively through Rwanda National Energy Company Limited would need to be implemented in accordance with the applicable regulatory framework and formally communicated to market participants. Rwanda Utility Regulatory Authority (RURA) remains the regulator of petroleum importation, while RNEC’s role is to coordinate bulk procurement and supply under the Government’s new importation arrangements. Under the bulk purchase model, participating Licensed Oil Marketing Companies obtain their allocated petroleum volumes through Rwanda National Energy Company Limited, which acts as the importer and aggregator. Licensed Oil Marketing Companies remain responsible for uplifting their allocated volumes and distributing them within Rwanda through their respective logistics, depot and retail networks.
