Lebanese Contractor Sues KPC For Sh13.2 Billion Over Mombasa-Nairobi Pipeline

A Lebanese firm tasked with laying down the Sh48 billion Mombasa-Nairobi pipeline is now suing the Kenya Pipeline Company (KPC) for Sh13.26 billion after President Uhuru Kenyatta froze payment to the construction firm after reports emerged that insiders attempted to collude with the contractor and earn Sh4.4 billion by delaying the project.

Abdallah Zakhem of Zakhem International Construction, filed the suit at the High Court against KPC seeking for compensation for the construction of the 450-kilometre pipeline. The firm has asked the court to order KPC to pay $67 million (Sh6.9 billion) for the unpaid work, $59.2 million (Sh6 billion) for delayed payment and $2.6 million (Sh267 million) as interest, the total claim is $128.8 million (Sh13.26 billion).

The scuffle began after State House allegedly blocked KPC from making further payments after the project that was supposed to be complete by February 9, 2016, after 18 months from August 2014, was delayed by two years in a scheme suspected to inflate the construction way above the agreed Sh48 billion. The delays alone would cost the government Sh4.4 billion to cover the four years’.

In yet another indictment, Director of Criminal Investigations (DCI) George Kinoti wrote to the acting managing director of KPC, Mr Hudson Adambi and asked KPC to stop any further dealings with Zakhem on the Sh48 billion contract until criminal investigations are concluded. The DCI was also investigating the Lebanese based firm over hundreds of thousands of litres of fuel that were leaked through one of the pipes it laid down.

“That kind of a tunnel cannot be done by an ordinary person, particularly the point at which one connects the hose pipe to siphon the products,” Mr Andambi had said indicating the contractor was suspect.

The Tycoon in court documents argues he is entitled to prompt payment of the sum of $126,255. 812 due since it was under contract. “The defendant’s wilful refusal to pay the sum owing and due to it is high-handed and capricious. No reason was given for the refusal and none exists in law.”

KPC has already paid the Lebanese firm Sh48.7 billion.