Shocking details reveal that Kenyan taxpayers may have paid double for the Ksh 48.4 billion Line 5 pipeline, which is the nation’s second-most expensive infrastructure project.
The pipeline intended to boost fuel transport from Mombasa to Nairobi has been plagued by corruption and financial mismanagement.
Lebanese firm Zakhem International won the contract in July 2014 to build the 450-kilometre pipeline.
A $350 million loan from six banks and a 28% contribution from KPC funded the project.
KPC is now paying an additional Ksh 40 billion to Ecobank Nigeria and Ecobank Kenya, despite the fact that the original contract excluded these banks.
The legitimacy of these payments is under legal scrutiny.
Ongoing disputes include allegations that Zakhem did not pay its subcontractor, Oilfields Engineering, over $17 million.
The case has seen multiple judge recusals and arbitrations.
KPC reports discrepancies in the project’s cost, with additional claims of millions due to variations and delays.
The company admits that the pipeline’s financial value may be inaccurate until it is resolved.
Frequent judge recusals and the unclear involvement of Ecobank Kenya and Nigeria continue to complicate the case.
Large sums of money remain tied up in court.
