Billionaire Humphrey Kariuki Booted Out From Sh7.7B Tender Deal With The State

Billionaire Humphrey Kariuki will not be smiling all the way to the bank after a humbling loss. This is after Rubis Energy emerged victorious in a Sh7.7 billion tender to supply low-sulphur diesel to Kenya Power’s 30 off-grid stations.

The conclusion of this tender follows a legal dispute initiated by Dalbit Petroleum Limited, which contested the award before the Public Procurement and Administrative Review Board (PPARB).

The PPARB’s decision, issued on January 2, dismissed Dalbit Petroleum’s case, paving the way for Rubis Energy to undertake this substantial 24-month contract.

Kenya Power initiated the tender process on October 10 of the previous year, seeking procurement for the supply and delivery of low-sulphur diesel to 30 off-grid power stations. The competitive process attracted bids from six oil marketers, with five failing at the preliminary tender evaluation stage.

Rubis Energy emerged as the sole successful candidate, succeeding through both technical and financial evaluation stages.

Dalbit Petroleum, owned by billionaire businessman Humphrey Kariuki, a notable ally of President William Ruto, however raised objections to the tender award. The company’s questioned the fairness of its disqualification, procedural irregularities, and discrepancies in the reasons provided for the disqualification.

Kariuki has diverse interests in several prominent Kenyan businesses, including oil marketer Dalbit Petroleum, Africa Spirits Limited, WOW Beverages, and Fairmont Mount Kenya Safari Club, contested the decision before the PPARB.

Rubis Energy Kenya is owned by Rubis Energie, a subsidiary of the Rubis Group, which is listed on the Paris Stock Exchange, following the full acquisition of both KenolKobil and Gulf Energy Holdings in 2019.

Rubis controls 8.6 percent of the local Kenyan market, making it the third-biggest marketer after TotalEnergies and Vivo Energies.

In its ruling, the PPARB dismissed Dalbit Petroleum’s request for review and ordered Kenya Power to proceed with procurement of the tender to conclusion.

“We are therefore not persuaded by the applicant’s arguments to consider that its tender was substantially responsive and that any minor deviations in its tender were immaterial and would not affect the competitive position of other tenders as public procurement espouses the principle of competition which requires that participating tenderers should complete on equal footing such that any non-compliance on any tender requirement calls for the automatic disqualification of the non-compliant tender,” the Board decided.

The Board emphasized the principle of competition in public procurement, stating that any non-compliance with tender requirements calls for automatic disqualification.

The successful award of this tender positions Rubis Energy as a key player in powering Kenya Power’s off-grid stations for the next 24 months.

The contract, valued at Sh7.737 billion, underscores Rubis Energy’s capability to meet the energy needs of the nation. It marks a crucial step in bolstering Kenya’s energy infrastructure, particularly in areas beyond the conventional grid.