Court slams brakes on SGR in compensation row

An oil company has obtained orders stopping construction of the standard gauge railway over a compensation dispute.

African Gas and Oil Company, the registered owner of 41.2 hectares in Miritini, Mombasa County, moved to court after the Government failed to pay over Sh519 million.

Justice Ann Omollo restrained the Government and the railway contractors from "entering, constructing, excavating or demolishing" any structures in the company's land for 14 days.

In January the firm was informed that part of its land had been listed for acquisition in the Kenya Gazette, under the Mombasa Port Area Road Development project, the company said in the petition.

This is the latest compensation feud to rock the Sh327 billion railway project whose construction is expected to be completed by mid next year.

Through lawyer Michael Oloo, African Gas argued it was told that its land would be acquired and it would be compensated.

The land in question had been the subject of an inquiry at public hearings in Mombasa that were conducted by the National Land Commission (NLC). After the inquiry, NLC ruled that Africa Gas acquired the land lawfully.

After hearing representations from the company, NLC awarded the firm Sh159 million for the land and Sh360 million for interruption of business. But trouble started soon after the ruling.

"The petitioner humbly accepted the award by (NLC) and supplied details of her bank account into which the money was to be deposited," the firm says in its petition. But this was never to be.

Before even the ruling was made, the firm argues that the SGR contractors had already moved onto the site and begun construction works, which are still ongoing.

"After the award was made, African Gas has made innumerable follow-ups and has written several letters to the (Kenya Railways Corporation) and (NLC) demanding payment, and which letters are yet to elicit any response," the firm said.

Africa Oil claimed it had set out plans to develop the suit property for commercial purposes and invested heavily.

"The petitioner has been deprived of the suit property by the State by way of compulsory acquisition yet the respondents, jointly and severally, have either neglected and or refused to pay compensation," the firm said.