Tata Chemicals Magadi Limited has warned that about 500 direct jobs and a planned Sh3.62 billion expansion project are at risk as a legal dispute over the suspension of its mining operations intensifies.
The soda ash producer says the prolonged shutdown could leave it unable to meet contractual obligations, expose it to potentially irreparable financial losses and threaten more than 1,100 livelihoods linked to its operations.
In court documents, the company states that it directly employs more than 500 workers and engages contractors who provide services to another 600 people.
“The applicant directly employs over 500 employees and has outsourced the service by contractors of another 600 people and the continued suspension places over 1,100 livelihoods in immediate jeopardy,” the court papers state.
The company has opposed an application by the Kajiado County government seeking to participate in proceedings challenging the suspension, arguing that delaying the case would prolong uncertainty over when it can resume operations.
The dispute stems from a decision by the Ministry of Mining, Blue Economy and Maritime Affairs to suspend the company’s operations over alleged regulatory breaches.
Tata Chemicals maintains that the suspension was imposed without adequate notice and adherence to fair administrative procedures.
In its filings, the company argues that the suspension was indefinite and lacked clear timelines, measurable compliance requirements or a transparent process for lifting the restrictions.
“The suspension was imposed for an independent indefinite period without prescribing objective timelines, measurable compliance criteria or any transparent mechanisms for lifting the suspension,” the company states.
It argues that the arrangement leaves its operations dependent on the ministry’s discretion, without certainty about when it can resume business.
The company has also warned that continued closure could derail its planned Sh3.62 billion expansion project, further increasing the financial impact of the dispute.
Dispute over Kajiado County’s participation
Tata Chemicals is resisting Kajiado County’s bid to join the judicial review proceedings, arguing that the county’s concerns over land tenure, lease expiry, royalties and other financial obligations are separate from the question of whether the ministry lawfully ordered the shutdown.
The company maintains that the judicial review case should focus on the legality of the suspension rather than determine disputes already being handled in separate proceedings.
Kajiado County, however, argues that the outcome could directly affect its financial interests and the welfare of communities living around the mining operations.
The county says it has been pursuing outstanding land rates amounting to Sh11.4 billion as of February 2023. It also says it previously attempted to enforce payment by withholding various business and trading licences.
The disagreement over land rates has resulted in separate court proceedings, which remain pending before the Court of Appeal.
Beyond revenue collection, the county says its interest in the dispute includes environmental protection and the economic welfare of residents affected by the company’s mining activities.
Ministry defends suspension
The Ministry of Mining has maintained that the suspension was necessary to compel the company to comply with statutory requirements.
In court documents, Secretary of Mines Thomas Mutwiwa argues that Tata Chemicals had repeatedly been notified of alleged regulatory violations, including unpaid royalties and accumulated arrears.
The competing positions leave the court to consider the legality of the suspension alongside the county’s request to participate in the proceedings.
For Tata Chemicals, the dispute threatens to prolong an interruption to its operations, with potential consequences for employees, contractors and its planned investment. The company is seeking to challenge the shutdown through the judicial review process.
