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Appendix III
THE ENERGY ACT, 2006
(No. 12 of 2006) In exercise of the powers conferred by section 102 of the Energy Act,
2006 the Minister for Energy makes the following regulations:-
The Energy (Licensing Of Petroleum Refining Businesses) Regulations, 2011
1. These Regulations may be cited as the Energy (Licensing of
Petroleum Refining Businesses) Regulations, 2011.
2. In these Regulations, unless the context otherwise requires-
“Act” means the Energy Act, 2006;
“Commission” means the Energy Regulatory Commission
established by the Act.
‘Crude oil’’ means natural mineral oil, including condensate, but
excluding petroleum products.
“Kenya Standard” means a specification or code of practice declared
by the Council under section 9 of the Standards Act
“Licence” means any document or instrument in writing granted
under this Act by the Commission to any person authorizing the
importation, exportation, refining, transportation, storage,
distribution and sale of petroleum.
‘‘Licensee’’ means any person holding the Petroleum Refining
Business licence granted by the Commission.
‘‘Minister’’ means the minister for the time being responsible for
energy.
Citation
Interpretation
No. 12 of 2006
Chapter 496
“Modification” means any change in the facility that alters the
existing design.
“Tribunal” means the Energy Tribunal set up under section 108 of
the Act.
3. These regulations shall not apply to the Kenya Defence Forces.
4. (1) A person shall not construct or undertake modification of a
petroleum refinery except in accordance with the Act, and the
terms and conditions of a valid construction permit issued under
the Act.
(2) The Commission or any authorized person acting on its behalf
may enter and inspect any premises or facility that the Commission
believes is under construction or modification for use as a
petroleum refinery.
(3) Where the Commission or its agents determines that a person is
engaged in the construction or modification of a petroleum refinery
requiring a construction permit and is not in possession of such
construction permit it shall direct that person to cease the
construction or modification unless and until the requisite permit is
obtained.
5 (1) A person who wishes to construct a petroleum refinery or
undertake any modification of an existing petroleum refinery shall
make an application to the Commission or its agents for a
construction permit in the form set out in Part 1 of Schedule A.
Application
Prohibition
against
construction
of petroleum
refinery
without
a permit
Application
for a
construction
permit
(2) The application for a construction permit shall be accompanied
by the documentation and information set out in Part 2 of Schedule
A.
(3) The construction permit issued under these regulations shall be
in the form set out in Part 3 of Schedule A.
6. (1) In evaluating an application for a petroleum refinery
construction permit, the Commission or its agents shall be satisfied
that the applicant has complied with the Act, these Regulations and
that the information and documents submitted with the application
form are true and correct.
(2) The Commission or its agents may request additional
information from an applicant that may be necessary to enable the
Commission to make a decision regarding the issuing of the
petroleum refinery construction permit.
(3) The Commission or its agents shall consider the application
within forty five (45) days after receipt of an application for
petroleum refinery construction permit which meets the
requirements of the Act and these Regulations
7. (1). A person shall not engage in a petroleum refining business
except in accordance with the Act and conditions of a valid licence
issued by the Commission or its agents.
(2) Where the Commission or its agents determines that a person is
engaged in a petroleum refining business and is not in possession
of a license it shall direct that person to cease the activity unless
and until the requisite petroleum refining business license is
obtained.
Consideration and determination of application for a
construction permit
Prohibition
against
operating a
petroleum
refining
business
without
a licence
8. (1) A person who wishes to engage in a petroleum refining
business shall make an application for licence to the commission or
its agents in the form set out in Part 1 of Schedule B .
(2) The application under paragraph (1) shall be accompanied by
the documents and any additional information specified in Part 2 of
Schedule B.
9. (1) In evaluating an application for a petroleum refining business
licence, the Commission or its agents shall take account of the
criteria in Part 3 of Schedule B and be satisfied that the applicant
has complied with the Act and the information and documents
submitted with the application form are true and correct.
(2) The Commission or its agents may request additional
information from an applicant that may be necessary to enable it to
make a decision regarding the issuance of the licence.
(3) The Commission or its agents shall consider the application
within thirty (30) days after receipt of an application which meets
the requirements of the Act.
10. The petroleum refining licence issued under these regulations
shall be in the form set out in Part 4 of Schedule B.
11. (1) A petroleum refining business licence shall be valid for one
year from the date of its issue and may be renewed in accordance
with the Act.
(2) An application for renewal of petroleum refining business licence
shall be made to the Commission or its agents at least thirty (30)
days before the expiry
Application
for a
petroleum
refining
business
licence
Consideration
and
evaluation of
applications
Form of
Licence
Duration of
licence
12. A petroleum refining business licensee shall be subject to the
following obligations:
(a) Maintain minimum stocks of crude oil as may be prescribed by
regulations under the Act;
(b) Make petroleum products that meet Kenya standards if they are
to be consumed in the domestic market;
(c) Operate and maintain the petroleum refinery in accordance with
the requirements of the Energy Act, Physical Planning Act,
Standards Act, Local Government Act, Environmental Management
and Co-ordination Act, Occupational Safety and Health Act,
Weights and Measures Act and any other written law;
(d) At all times comply with the Act, these Regulations and carry
out the legitimate instructions of the Commission or its agents;
(e) For petroleum products intended for domestic consumption deal
only with persons in possession of a valid petroleum business
licence;
(f) Inform the Commission or its agents in writing of any changes of
directorship or address or telephone number or other material
particulars submitted as part of the application for the licence
within thirty (30) days of the relevant change taking effect; and
(g) Submit information to the Commission or its agents as required
under the Act and any regulations made there under.
13. (1) A construction permit or petroleum refining business
licence, or a certified copy thereof, shall be displayed in a
prominent position on the premises in respect on which it is issued.
Obligation of
a petroleum
refining
business
licensee
No 12 of 2006
Chapter 286
Chapter 496
Chapter 265
No 8 of 2000
No 15 of 2007
Chapter 513
Chapter 403
Chapter 472
Display of the
permit or licence
(2) Any licence issued in terms of these Regulations:
(a) remains the property of the Commission;
(b) may be modified, suspended, revoked or amended at any
time as provided under the Act;
(c) may not be tampered with or defaced in any manner; and
(d) is not transferable without the written consent of the
Commission.
14. The Commission or any authorized person acting on its behalf
may enter and inspect any premises where petroleum refining
business is conducted for the purposes of inspections or
conducting investigations pursuant to the provisions of the Act or
Regulations made under the Act.
15. (1) Any person aggrieved by a condition or term imposed in the
licence by the Commission or its agents under these Regulations
may in accordance with the Act, apply in writing to the Commission
to amend such condition and/or term.
(2) If the aggrieved person is not the licensee the Commission shall
inform the licensee within seven (7) days of receipt of the
application and the Commission or its agents will determine the
matter within thirty (30) days.
(3)A licence amended under the Act and these regulations shall
retain the existing expiry date.
16. (1) The Commission or a its agents may at any time suspend or
revoke any licence issued under this Regulation if the licensee
commits any breach stipulated in the Act.
Inspection and
investigation
Amendment of licence
Revocation or
Suspension
of licence
(2)A petroleum refining business licence shall cease to be valid if
the licence is suspended or revoked by the Commission or its
agents.
(3) The Commission or its agents shall give the licensee fourteen
(14) days to show cause why the licence should not be revoked.
(4)The Commission or its agent shall determine the matter within
thirty (30) days from the expiry of the notice period.
(5). The power to suspend or revoke the licence for contravention of
its conditions is in addition to any other penalty which may be
imposed under the Act or by any other law.
17. (1) A person aggrieved by the decision of the Commission in
refusing to renew, amend, replace, grant a licence or impose
conditions on a licence or in revoking a licence may appeal to the
Tribunal within thirty (30) days of receipt by him of the written
notification of such action.
(2) A person aggrieved by the decision of the commission’s agents
in refusing to renew, amend, replace, grant a licence or impose
conditions on a licence or in revoking a licence may appeal to the
Commission within thirty (30) days of receipt by him of the written
notification of such action.
18. Any person who contravenes any of the above regulations
commits an offence in accordance with the Act and shall on
conviction be liable to a fine not exceeding one million shillings or
to a maximum term of imprisonment of one year, or both such fine
and imprisonment.
Appeals
Penalties
Dated the............................................................... 2011.
KIRAITU MURUNGI
Minister of Energy
SCHEDULE A
PART 1
THE ENERGY ACT, 2006
APPLICATION FORM FOR A PETROLEUM INSTALLATION
CONSTRUCTION PERMIT
(A separate application form must be completed in respect of each separate installation)
1. Name of applicant/proponent: _________________________________
2. Details of applicant/proponent: ________________________________ (a) Income Tax Personal Identification Number(s): ________________
(b) Postal address: ______________________________________ (c) Email Address : ___________________________________
(d) Site location :
I. Plot No.: ____________________________________________
II. Street/Market: _______________________________________
III. Town/County: _________________________________________
3. Give full details of proprietors or partners owning business or directors/shareholders of the company, as the case may be:
Name Nationality (Where applicable
No. of shares held) _________ ________________ __________________
_________ ________________ __________________
___________ _______________ __________________
(Any additional information should be submitted on a separate sheet of paper)
4. Give full details of directors of the company:
Name Nationality Passport/ ID No.
_____________ ________________ ________________ _____________ ________________ ________________ _____________ ________________ ________________ (Any additional information should be submitted on a separate sheet of paper)
5. Full description of the proposed petroleum facility: _______________________________________________________________
_______________________________________________________________
6. Specify the points between which the pipeline is to run (For Pipeline
installations only):
_______________________________________________________________
7. Specify the storage capacity of the facility:
____________________________________________________________ _____________________________________________________________ _____________________________________________________________
8. Give details on equity capital including other sources of financing: _______________________________________________________________
9. Indicate bank references:
_______________________________________________________________ _________________________________________________________________ _________________________________________________________________
10. CONDITIONS FOR ISSUANCE OF A CONSTRUCTION PERMIT
Compliance with:
(a) ENERGY ACT 2006.
(b) Environmental Management and Co-ordination Act, 1999 and in particular the report of the Environmental (Impact Assessment and audit) Regulations, 2003.
(c) Physical Planning Act, 1996.
(d) Local Government Act.
(e) Any other subsidiary legislation regulations from the above Acts.
11. DECLARATION
i. I/We have read and understood the relevant sections of the Energy Act, No. 12 of 2006 and the related petroleum rules and regulations, and agree to abide with them.
ii. I/We hereby certify that the information given above is to my/our
knowledge true and accurate.
iii. I/We understand that it is an offence to give false information in an
application for a construction permit.
iv. I/We hereby confirm that our Company/Business shall abide by the above terms and conditions with regard to construction of the petroleum installation. I also understand that the construction permit is subject to these conditions.
Name of Company: ____________________________________________ Name and ID No. of Person signing The Declaration: ______________ Designation and telephone No.:___________________________________ Signature & Stamp: _____________________________________________ Date: _________________________________________________________ Email address: _________________________________________________
12. FOR OFFICIAL USE ONLY
i. Date application received:
ii. Date of review:
iii. Decision:
iv. If application is deferred or rejected, date of letter advising applicant accordingly:
1. Permit details:
No.: ___________ Date issued: __________ Expiry date: __________
SCHEDULE A
PART 2
INFORMATION AND DOCUMENTS TO ACCOMPANY APPLICATION FOR
A CONSTRUCTION PERMIT
KEY REF – Refinery.
PBSF – Petroleum Bulk Storage Facility.
RT – Retail Dispensing Site.
PL – Pipeline.
Criteria REF PBSF PL RT
Application form Yes Yes Yes Yes
Three copies of approved plans and specifications Yes Yes Yes Yes
Environmental Impact Assessment (EIA) Licence Yes Yes Yes Yes
Certificate of compliance with Land Use Yes Yes Yes Yes
SCHEDULE A
PART 3
PERMIT NO. …………………
THE ENERGY ACT, 2006
PETROLEUM FACILITY CONSTRUCTION PERMIT
Construction Permit is hereby granted to _______________________of P.O.
Box _____________ to construct the following petroleum Facility (is):
Construction of: 1. Petroleum Facility################
On premises situated at:
Plot No. : ___________________________
Street/Market : ___________________________
Town/County : ___________________________
This Permit expires on : ___________________________
Dated this: ________________________
Signature: ________________________ (SEAL)
Director General Energy Regulatory Commission
Conditions:
1. ………………………………………………………………………..
2. ………………………………………………………………………..
3. ………………………………………………………………………..
4. ………………………………………………………………………..
SCHEDULE B
PART 1
THE ENERGY ACT, 2006
APPLICATION FORM FOR A PETROLEUM BUSINESS LICENCE (EXCEPT LPG)
(A separate application form must be completed in respect of each separate business establishment)
1. Name of business/applicant: __________________________________
2. Details of applicant: a) Income Tax Personal Identification Number(s): _________________
b) Postal address: ______________________________________ c) Email Address : ___________________________________
d) Location of business premises:
I. Plot No.: ___________ Building Name: ____________________
II. Street/Market: _______________________________________
III. Town/District: _________________________________________
3. Give full details of proprietors or partners owning business or directors/shareholders of the company, as the case may be:
Name Nationality (Where applicable
No. of shares held) _________ ________________ __________________
___________ ________________ __________________
___________ __________________ __________________
(Any additional information should be submitted on a separate sheet of paper.)
4. Give full details of directors of the company:
Name Nationality Passport/ ID No. _____________ _________________ _________________ _____________ __________________ ________________ (Any additional information should be submitted on a separate sheet of paper)
5. Full description of the business (es) for which the licence is required: _______________________________________________________________
6. (a) Indicate the number and date of issue of any licence previously held
under the Act:
_______________________________________________________________
(b) Indicate the period for which the licence is being applied (maximum is one year from the date of issue): _______________________________________________________________
7. State if you are or any of your partners/directors is an undischarged
bankrupt (If so indicate the names):
_______________________________________________________________
8. (a) Has any previous application for a licence been rejected under the Act? (If so, give details):
____________________________________________________________
(b) Has any previous licence been cancelled under the Act? ____________________________________________________________
9. (a) Criteria to be met for new application and for renewal of a licence is attached at the back of the application form.
(b) Certified copies (by advocate / commissioner of oaths) of documents as per criteria specified above should be submitted together with the licence application.
10. CONDITIONS FOR PETROLEUM BUSINESS LICENCE IN KENYA
a) Compliance with ENERGY ACT 2006 and any other subsidiary legislation regulation issued there under.
b) Environmental Management and Co-ordination Act, 1999
c) Local Government Act.
d) Traffic Act
e) Relevant Kenya Standard on Petroleum Tankers
f) Any other subsidiary legislation regulations from the above Acts. DECLARATION
i. I/We have read and understood the relevant sections of the Energy Act, No. 12 of 2006 and the related regulations issued therein, and agree to abide with them.
ii. I/We hereby certify that the information given above is to my/our
knowledge true and accurate.
iii. I/We understand that it is an offence to give false information in an
application for a licence.
iv. I/We commit to conduct an honest petroleum business.
Name of Company: ____________________________________________ Name and ID of Person signing the Declaration: __________________ Designation and telephone No.: __________________________________ Signature & Stamp: _____________________________________________ Date: _________________________________________________________ Email address: ________________________________________________
FOR OFFICIAL USE ONLY 1. Date application received: 2. Date of meeting of Petroleum Licensing Committee: 3. Decision of Petroleum Licensing Committee: Members present: Signature 1. 2. 3. 4. 4. If application is deferred or rejected, date of letter advising applicant accordingly: __________________________________________ ________________________________________________________________ 5. Date of review of application: Decision of Committee: Members present: Signature 1. 2. 3. 4.
6. Licence details:
No.: _________ Date issued: _______ Expiry date: ___________
SCHEDULE B PART 2
THE ENERGY ACT, 2006
QUESTIONNAIRE TO BE FILLED BY NEW APPLICANTS FOR A
PETROLEUM BUSINESS LICENCE (EXCEPT LPG)
1. Name of applicant: _________________________________________
2. Nature of business (Sole Trader, Partnership, Private Company or Public Company):__________________________________________________
3. Certificate of Incorporation/Registration Number and date: __________
a) Country of Incorporation: __________________________________
b) Physical address: __________________________________________
c) Postal address: __________________________________________
d) Telephone/ fax: __________________________________________
e) Email address: __________________________________________
4. Give full details of proprietors or partners owning business or
directors/shareholders of the company, as the case may be:
Name Nationality (Where applicable No. of shares held)
_________ ________________ __________________
___________ _______________ __________________
___________ ________________ __________________ (Any additional information should be submitted on a separate sheet of paper)
5. Give full details of directors of the company:
Name Nationality Passport/ ID No. _____________ _________________ _________________ _____________ _________________ ________________ _____________ __________________ ________________
(Any additional information should be submitted on a separate sheet of paper)
6. Give details on equity capital including other sources of financing: _______________________________________________________________
7. Indicate bank references ______________________________________
8. Type of business required to be licensed (tick as appropriate):
(i) Refining (ii) Importation (iii) Exportation (iv) Wholesale (v) Storage (vii) Specify any other __________________________________
9. Indicate if you:
(a) Own storage facilities (If so, give details including location and capacity): __________________________________________
(b) Have hospitality/rental arrangement (If so, give details
including copies of any agreements): ____________________
10. Do you intend to market your product locally? ___________________ If Yes,
(a) Give the number and locations of Retails Outlets: _____________________________________________
(b) Give the number and locations of Distribution Depots including their capacities: ______________________________
(c) If neither (a) nor (b) is applicable, explain: ______________ _____________________________________________________________ (d) Give details on how you propose to maintain the approved
quality of your product: ___________________________________
11. (a) Give details of measures you have taken/you propose to take to ensure that the product you handle does not endanger life or pollute the environment: ____________________________________________
(b) Any additional information that the applicant wishes to give: _________________________________________________________ (If space provided above is not adequate use plain paper where applicable and attach to this questionnaire) Name of Company: ______________________________________________ Name and ID No. of Person signing the Declaration: ______________ Designation and telephone No.:___________________________________ Signature & Stamp: _____________________________________________ Date: ______________________________________________________
SCHEDULE B PART 3
LICENCE EVALUATION CRITERIA FOR NEW PETROLEUM BUSINESSES
(EXCEPT LPG)
Criteria REF IMP EXP STO WH PL
Application form Yes Yes Yes Yes Yes Yes
Detailed Questionnaire Yes Yes Yes Yes Yes Yes
Certified copy of Memo and Articles of association Yes Yes Yes Yes Yes Yes
Certified copy of Certificate of Incorporation Yes Yes Yes Yes Yes Yes
Certified copy of PIN registration certificate Yes Yes Yes Yes Yes Yes
Certified copy of VAT registration certificate Yes Yes Yes Yes Yes Yes
Certified copy of current Tax compliance Certificate Yes Yes yes yes Yes yes
Identification documents for directors (ID/passport page 1 and 5)
Yes Yes yes yes Yes yes
Work permits for non-citizens / Entry permit class H Yes Yes yes yes Yes yes
Certified copy of Lease agreement/Premises ownership Yes Yes Yes Yes Yes Yes
Letter from OSMAG confirming membership Yes Yes Yes
Signed KPRL Processing Agreement Yes
Purchase of Minimum crude oil Yes
Letter from MOE confirming applicant Signed OTS agreement for crude and refined products
Yes
Supply agreement with licensed importer or supplier /letter of intent
Yes Yes
EIA Licence (if new)/ EA if existing Yes Yes
Certified copy of Certificate of Compliance with Physical Planning Act
Yes Yes
Certified copy of Clearance Certificate form Chief Fire Officer
Yes Yes
Detailed approved drawings drawn to scale Yes Yes
Certified copy of DOSHS certificate of registration Yes Yes
LICENCE EVALUATION CRITERIA FOR RENEWAL OF PETROLEUM BUSINESSES (EXCEPT LPG)
KEY REF – Refining IMP – Import EXP – Export STO – Storage & Loading WH – Wholesale PL – Pipeline,
Criteria REF IMP EXP STO WH PL
Application form Yes Yes Yes Yes Yes Yes
Copy of previous licence Yes Yes Yes Yes Yes Yes
Proof that expired licence was utilised Yes Yes Yes Yes Yes Yes
Certified copy of Current Tax compliance certificate Yes Yes yes yes Yes yes
Proof of active OSMAG membership – OSMAG letter Yes Yes Yes
Proof of crude processing - KPRL letter Yes
EA acknowledgement letter from NEMA Yes Yes
Certified copy of Clearance certificate form chief fire officer
Yes Yes
Certified copy of DOHSS certificate of registration Yes Yes
SCHEDULE B
PART 4
THE ENERGY ACT, 2006
PETROLEUM BUSINESS LICENCE
No. ERC/PET/ _______________
Licence is hereby granted to ____________________________of P.O. Box
_____________ to carry on the following petroleum businesses:
LICENCE NAME (EXCEPT LPG)
On premises situated at:
Plot No. : ___________________________
Building : ___________________________
Street/Market : ___________________________
Town/District : ___________________________
This licence expires on : ___________________________
Dated this: ________________________________
Signature _________________________________
(SEAL)
Director General Energy Regulatory Commission