Tanzanian tycoon, Ally Edha Awadh’s push for a share of Kenya’s cooking gas market has suffered a blow after a tribunal revoked the environmental permit issued to his firm for the construction of an import handling facility in Kilifi County.
The National Environment Tribunal revoked the Environmental Impact Assessment (EIA) permit issued to Lake Oil, citing inadequate public consultations with the local community.
Lake Oil is a subsidiary of the Lake Group, which was founded by Mr Awadh in 2006.
Lake Oil is currently building a 22,000-metric tonne facility in Kilifi County, to handle imports of liquified petroleum gas (LPG) or cooking gas imports.
Lake Oil received the EIA permit from the National Environment Management Authority (Nema) in December 2019. This (permit) was followed by regulatory approval from the Energy and Petroleum Regulatory Authority, paving the way for the start of the project.
However, petitioners went to court seeking orders to stop the project on concerns that the firm did not undertake adequate public participation.
The petitioners argued that the lack of adequate public participation has exacerbated the project’s environmental and safety risks.
“It is hereby ordered and decreed, that the EIA licence No. Nema/EIA/PSL/8728 issued by the first respondent to the second respondent on December 10, 2019, is hereby cancelled/revoked for want of adequate public participation,” said the tribunal in its ruling on March 10, 2025.
An EIA helps to pick and mitigate potentially negative environmental and social impacts of a project, helping an investor to effectively protect local communities and ecosystems.
It is not clear at what stage of the construction is the facility, with focus shifting to the Energy and Petroleum Regulatory Authority (Epra) to see if it will issue orders to freeze the project.
The other Tanzanian tycoon seeking a pie of the cooking gas market in Kenya is Rostam Aziz who in 2023 received regulatory approval to build a 30,000-tonne plant to handle imports of the commodity.
But the construction of the plant by Mr Aziz’s Taifa Gas firm is said to have slowed down amid funding hitches, with the project missing its targeted completion deadline which was at the end of last year.
Lake Oil and Taifa Gas are two of the firms keen to build facilities to handle cooking gas imports and shake the dominance of African Gas and Oil Limited (AGOL), which handles at least 90 percent of imported liquid petroleum gas.
Entry of new players is meant to ultimately lower fees for handling coking gas and in turn lower retail prices of the commodity.
The tribunal further ordered directors of Lake Oil and Vipingo Development Limited — owners of the land on which the facility is being built— to pay a Sh2 million fine for defying an earlier order to freeze the project.
Lake Oil had in January this year been ordered to stop construction of the plant pending the final decision from the tribunal. The firm however defied this order.
The facility by Lake Oil, if cleared to proceed, will on completion be the third biggest plant for handling imported cooking gas in Kenya. AGOL’s facility in Mombasa is the largest with a capacity of 25,000 tonnes.
However, Kenya Pipeline Company is set to build a 30,000-tonne facility in Changamwe, in what will be the first government-owned such facility, further stepping up competition on AGOL.
