The Senate Standing Committee on Energy has launched a formal inquiry into the controversial handover of a 30,000-metric-tonne Liquefied Petroleum Gas (LPG) storage facility in Mombasa to Nigerian firm Asharami Synergy Ltd. 

The move has raised major concerns about transparency, legality, and the sidelining of the Kenya Pipeline Company (KPC), which had originally been tasked with developing the project.

The facility, situated on a 23-acre parcel of public land in Changamwe, was intended to be a public-sector initiative aimed at increasing clean energy access and reducing household fuel costs. 

However, a decision by the Ministry of Energy and Petroleum to lease the land to Asharami Synergy — a subsidiary of Sahara Group — for 31 years has sparked criticism across political, professional, and civic quarters.

Key issues raised include the Ministry’s bypassing of KPC’s mandate under the Companies Act, an opaque procurement process, and the lack of public engagement. 

The Office of the Auditor General also flagged a potential loss of Ksh.192.6 million in taxpayer funds already spent by KPC on feasibility studies and engineering designs.

Local communities in Saragota, Changamwe have written to the Senate citing land injustices, lack of environmental assessments, and failure by key regulatory bodies like EPRA and NEMA to engage the public. 

The residents are particularly alarmed about the impact on community safety and historical land ownership.

Busia Senator Okiya Omutatah presented the petition to the Senate on behalf of Sarasota residents.

The committee’s visit to Mombasa has also opened up a broader debate on the management of energy infrastructure. 

Mombasa Governor Abdulswamad Sheriff Nassir, in a sharp criticism of Kenya Power, said the utility does not meet its financial obligations to counties.

“Kenya Power does not pay wayleaves to the County Government of Mombasa,” said Governor Abdulswamad. “Yet they expect us to pay electricity bills in time, and if we don’t pay, they disconnect us — including disconnecting hospitals.”

In response, Senator Dr. Oburu Oginga revealed that the Senate is preparing legislation to address this problem.

“We are coming up with a bill so that Kenya Power does not disconnect electricity in essential facilities like hospitals,” said Dr. Oburu.

However, Senator Ogolla offered a different perspective, noting that counties also share blame in the standoff.

“The county governments do not want to pay electricity bills that they owe to Kenya Power,” she stated.

Adding to the dialogue, Senator Mungatana emphasized the need for legal reform to balance the responsibilities between county and national governments.

“What you are saying is what Governor Sakaja has been saying all along — we need to find a solution through amendments to the Energy Act,” he said.

Senator Mungatana also argued that the national government should assume responsibility for certain costs, particularly for infrastructure tied to security.

“The National Government should take over the electricity bill for street lighting since security is a national government function,” he added.

Despite the controversy, the LPG project is expected to offer substantial benefits if implemented properly. These include a potential 30% reduction in domestic LPG prices due to lower demurrage costs, increased environmental protection by reducing charcoal and wood use, and the diversification of KPC’s revenue streams.

Still, critics argue that without a clear framework for oversight and public protection, the benefits may remain out of reach — especially under a long-term private lease. The Senate Committee is expected to table its findings in the coming weeks and may recommend legislative or administrative interventions to restore public confidence.