NAIROBI, Kenya- President William Ruto has defended the government’s decision to end Tata Chemicals’ long-running contract to extract soda ash at Lake Magadi in Kajiado County, saying Kenya must secure greater economic benefits from its mineral resources.
Speaking in Kajiado on Saturday, Ruto described the arrangement with Tata Chemicals as “exploitative and extractive” and said the government would re-advertise the Magadi contract to allow greater participation by other investors.
“For nearly 100 years, Kenyans, especially the people of Kajiado, have not received their fair share of the benefits from the minerals extracted from their land,” Ruto said.
He said the government would no longer allow a single company to monopolise operations at Magadi at the expense of residents and the wider economy.
Under the new arrangement, companies seeking to operate at Magadi will be required to establish processing and manufacturing facilities in Kenya rather than simply extracting minerals for export.
“Our minerals must create value at home, generate wealth for Kajiado and jobs for our young people and stimulate local industries,” Ruto said.
Century-old soda ash operation
Tata Chemicals Magadi has produced soda ash at Lake Magadi for more than a century.
The company says it was established in 1911 and processes trona, a naturally occurring mineral containing sodium carbonate compounds, into soda ash for export.
More than 95% of its product has historically been exported through the Port of Mombasa.
The company has been part of Tata Chemicals since 2005 and describes itself as Africa’s largest soda ash manufacturer and one of Kenya’s leading exporters.
The legal foundation of the operation dates back even further.
A 1928 lease gave the company rights to search for, extract and carry away soda deposits around Lake Magadi and Lake Natron.
The Court of Appeal recorded the original lease as having a 99-year term, with rent and royalties forming part of the arrangement.
Government wants local manufacturing
Ruto said the next phase of investment must go beyond mineral extraction and create industries within Kenya.
The President said companies awarded the new Magadi contracts would be expected to establish processing and manufacturing facilities, with the government seeking to increase employment and stimulate industries linked to the minerals.
The announcement follows the government’s decision earlier this year to suspend operations and exports at Tata Chemicals’ Magadi facility pending a compliance review.
Ruto subsequently ordered the company to leave the country, while Tata Chemicals said it remained committed to resolving the matter through legal and regulatory dialogue.
The government has also indicated plans to attract new investors to develop manufacturing linked to Magadi’s mineral resources.
Industrialisation Principal Secretary Juma Mukhwana said the government wanted to transform the area into a broader manufacturing hub following Tata Chemicals’ exit.
Disputes over land charges
Tata Chemicals’ operations in Magadi have also faced disputes with the Kajiado County Government over land rates and other charges.
Court records show a long-running dispute involving claims over land rates and royalties, with the figures in earlier proceedings running into billions of shillings. The company’s operations were also previously halted following a dispute over unpaid county charges.
The latest government decision now sets the stage for a new tender for the mineral resource.
Ruto said the fresh process would open the opportunity to more investors while ensuring that future exploitation of Magadi’s resources delivers greater value to Kenya and the people of Kajiado.
