A Sh622 million revenue dispute between the government and Chinese-owned Bao Gold Hill Kenya Limited over gold mining fields in Narok County has escalated to the Court of Appeal, which has suspended mining activities pending a full hearing.
The court intervened after the State warned that continued mining by Bao Gold Hill would lead to irreversible loss of public resources and expose the Exchequer to unpaid royalties and land rent amounting to hundreds of millions of shillings.
“If the respondent (Bao Gold) is allowed to extract minerals pending the determination of the intended appeal, the orders granted would be irreversible,” the court ruled, noting that once minerals are depleted, they cannot be recovered.
The decision followed an application by the Attorney- General, the Ministry of Mining, and the Inspector General of Police seeking a stay of execution of High Court orders issued in October 2025 in favour of Bao Gold Hill.
At the centre of the dispute is whether Bao Gold Hill holds a valid mining licence for the extraction of gold for a duration of 25 years. The company applied for a licence in July 2019 covering an area of 4.78 square kilometres in Narok.
However, the Mineral Rights Board later recommended rejection of the application, citing failure to submit mandatory documents under the Mining Act. The Cabinet Secretary upheld this recommendation in September 2024. Government inspectors subsequently accused the firm of conducting illegal mining and gold processing without a valid licence.
According to the State, inspections revealed operations that deprived the Exchequer of Sh622.28 million in unpaid royalties and land rent. It argued that continued mining posed a significant fiscal risk.
In October 2025, the Environment and Land Court in Narok issued conservatory orders compelling the Ministry of Mining to reinstate Bao Gold Hill’s details and license on the mining cadastre. The State appealed and directed police to withdraw from the site.
These orders effectively permitted mining to resume for up to 12 months while the company’s constitutional petition was heard.
The State appealed, arguing that the lower court’s orders were final in nature and prematurely resolved the dispute. It also warned that continued mining could lead to additional revenue losses exceeding Sh600 million and legitimize what it termed unlawful operations.
Bao Gold Hill countered that it had been granted a mining license in May 2021, valid until 2046, and had invested heavily based on approvals from the Ministry.
The firm disputed the alleged revenue loss, arguing that halting operations would deny the State future taxes, royalties, and jobs. It also cautioned that the dispute could deter foreign investment in Kenya’s extractive sector.
However, the appellate court was unconvinced. While acknowledging that the appeal raised arguable points, the judges ruled that public interest justified suspending mining activities.
They also expressed concerns about enforceability, citing the company’s foreign status and the risk it might leave Kenya before the appeal’s resolution.
The court emphasized that conservatory orders should safeguard public interest rather than resolve disputes prematurely.
“All these grounds undeniably demonstrate that the intended appeal will be rendered nugatory if we do not grant an order for stay,” the judges ruled, adding that the State could compensate Bao Gold Hill if it ultimately loses the appeal.
