NAIROBI, Kenya – French energy firm Rubis Group is set to inject Sh6 billion into the National Oil Corporation of Kenya (NOCK) over the next five years as part of a newly structured partnership aimed at revitalizing the struggling state-owned entity.
The deal, which does not involve the sale of NOCK shares, will see Rubis commit Sh3 billion towards stock financing and another Sh3 billion for infrastructure improvements, including the renovation and expansion of NOCK’s retail network.
In addition to the financial investment, the partnership will introduce an advanced Enterprise Resource Planning (ERP) system designed to streamline operations and enhance internal controls.
Revenue-Sharing Model, Not Privatisation
Speaking on the partnership, NOCK CEO Leparan ole Morintat clarified that the collaboration is a profit-sharing arrangement rather than a move towards privatisation.
Rubis, as a non-equity strategic partner, will earn returns based on an interest rate pegged to the 182-day Treasury Bill rate plus four percentage points.
“This is a profit-sharing model, not a privatisation of NOCK. The strategic partner will inject capital for stock financing and infrastructure upgrades while helping us modernize operations through a robust ERP system,” said Morintat.
The objective, he added, is to enhance NOCK’s downstream business by improving sales, modernizing infrastructure, and strengthening financial controls to rebuild its market share and profitability.
Government-Backed Restructuring Plan
As part of NOCK’s revival, the government has approved a restructuring plan that will see the company operate under a holding structure with three distinct subsidiaries:
NOCK Upstream Limited – Focused on oil exploration and production.
NOCK Downstream Limited – Responsible for marketing, retail, and distribution, including emerging green energy solutions.
NOCK Supply and Trading Limited – Managing importation, exportation, and the establishment of strategic petroleum reserves.
The overhaul comes as NOCK grapples with mounting debts, which currently stand at Sh7.98 billion.
This includes Sh5 billion owed to Kenya Commercial Bank (KCB) and Stanbic Bank, Sh1.53 billion in pending bills, Sh548.4 million in outstanding dealer prepayments, and Sh58.8 million in dealer cash deposits.
Recent documents indicate that the KCB loan balance has reduced to Sh3 billion following a government-backed repayment plan that included a Sh3.478 billion “haircut.”
The first installment of Sh1.215 billion was paid last month.
The partnership with Rubis is expected to provide the much-needed capital injection to stabilize NOCK and reposition it as a key player in Kenya’s petroleum sector.
