Petitioner urges National Assembly to enforce Sh24 billion Kwale sugar award

A petitioner has called on the National Assembly to compel the government to settle a Sh24 billion High Court award made to Kwale International Sugar Company Limited over a contract breach.

Kennedy Ochieng’, executive director of the Kenya Legal Resource Centre, filed the plea seeking enforcement of the December 2025 judgment. The court held that the National Treasury and the Attorney-General failed to deliver possession of 15,000 acres leased to the firm under a 2007 agreement.

Mr Ochieng’ said the delay or refusal to comply with the Mombasa court decision undermines the law. He also asked the House to order an independent inquiry into the conduct of public officials whose actions or omissions led to the liability.

“The High Court found that the government breached its statutory and contractual obligations to Kwale International Sugar Company Limited, causing the collapse of a major agricultural investment in Kwale County,” Mr Ochieng’ stated.

Lack of state protection crippled the company’s $300 million investment. That figure included $140 million in syndicated loans and $160 million in equity. The firm shut down and has remained in operational limbo for years.

The sugar company is an ultra-modern agro-industrial enterprise in Msambweni Sub-county, Kwale County. It stands on the site of the former Ramisi Sugar Factory. Its mill can crush 3,300 tonnes of sugarcane daily. It runs a 5,000-hectare nucleus estate and works with more than 1,200 registered out-grower farmers.

The complex includes an 18-megawatt bagasse-fired power plant that generates renewable electricity. It also uses a sub-surface drip irrigation system that cuts crop water needs by 40 per cent.

Mr Ochieng’ warned that further delay in payment could raise the cost to taxpayers through interest and legal fees. He said it could also discourage local and foreign investment. The petition asks the National Assembly to pass policies that prevent similar contractual breaches and to demand a report on the financial implications of the judgment plus measures to protect public funds.

Limited access to the land left irrigation and power infrastructure incomplete. Cane crushing equipment was underused, production fell, costs rose and revenues declined. The petition puts the resulting loss at $277.7 million. That sum covers extra project costs, operational losses, interest, hedging and restructuring charges, penalties and financing costs.

The company filed suit on April 1, 2022 against the Cabinet Secretary for the National Treasury. It sought a declaration that the government had breached its statutory and contractual duties.

In 2006 the firm’s promoters tried to buy 42,000 acres from the Bank of India. The government stepped in, acquired the land and set aside 27,000 acres for squatter resettlement. The remaining 15,000 acres were leased to the sugar company on August 20, 2007 for 99 years starting June 1, 2007 for sugarcane farming and related work.

Access was further blocked by a Mombasa court injunction. The orders stayed in place until March 13, 2018, when the company successfully challenged them. The related petition was set aside and later dismissed in a judgment delivered on January 13, 2022.

The petition also states that the Cabinet Secretary caused 1,000 hectares of the leased land to be excised and allocated to Base Titanium Limited without due process or compensation to the sugar company.