Bernard Olayo is a Kenyan entrepreneur who sensed an opportunity to develop oxygen plants. In 2014, Olayo started Hewatele (“abundant air” in Swahili) to supply African hospitals with oxygen.
And when the pandemic caused more hospitalizations requiring more people to be put on oxygen, he quickly increased production. He built small oxygen plants which he says allows him to undercut prices in markets where oxygen costs 10 times more.
He now serves more than 250 hospitals and hopes to build a liquid oxygen plant and start to export the gas to neighboring countries.
Olayo says he got motivated to get into the business of building oxygen plants when he worked as a doctor and saw at first hand how hospitals didn’t have enough oxygen for his surgery cases, particularly children with pneumonia.
“So I founded an organization called the Center for Public Health and Development to test some ideas I had. The first trials failed. We put very small oxygen plants in 14 health facilities across East Africa. After just 20 months, all of them had stopped working, as the hospitals had tried to repair the equipment themselves,” he told Bloomberg.
According to him, he realized that there was the need to do things differently and so he came up with the milkman model. With that model, oxygen cylinders are regularly dropped off at remote hospitals and clinics and the empty cylinders are returned to be refilled, GatesNotes explains.
“With adequate cylinders, a well-maintained plant, and a distribution truck or two, it’s possible to supply oxygen to all health facilities within a 100-kilometer radius,” Olayo says.
And when the pandemic struck, demand for his plant tripled and he had to push production around the clock. He told Bloomberg that he doubled the number of plant operators and truck drivers for distribution to hospitals.
“We built oxygen manifolds outside Covid-19 wards so we could bring in cylinders,” he adds.
When maintenance became a challenge for him because he could not get parts due to global lockdown, he relied on local artisans who came up with solutions.
Olayo hopes that his milkman strategy could be replicated across sub-Saharan Africa and globally. According to him, it works mostly for the developing world, where infrastructure is weak and health financing is not that good.
He also hopes to capture 40% of Kenya’s oxygen market when a liquid plant he is constructing comes to life in 2023. “This will produce 20 tons of oxygen a day, equivalent to at least 2,000 cylinders. But we’ll still use the milkman model: Rather than build plants at the hospitals, I’ll build tanks and compressors to fill cylinders and distribute them locally,” he tells Bloomberg.
According to him, with the liquid plant, his organization Hewatele can lower the price of oxygen by half and still make a profit and even export to Uganda and Tanzania.