The Kenyan National Assembly has approved a government plan to partially privatize the Kenya Pipeline Company (KPC), clearing the final legislative hurdle for the divestiture of a majority stake in the state-owned enterprise. 

The move paves the way for the government to sell 65% of its shareholding to private investors, primarily through a public listing before the end of the year.

KPC’s approval decision was formalized with the adoption of Sessional Paper No. 2 of 2025, which outlines the divestment strategy, enabling the Kenyan government to retain a 35% shareholding in the company that manages the country’s fuel transportation network.

According to government projections, the sale is expected to generate an estimated Sh100 billion ($769 million), helping to address the nation’s current budget shortfalls.

The plan has been championed by the Treasury, which first approved the partial privatization in July, with Treasury Cabinet Secretary John Mbadi arguing that a partial sale could quadruple state revenues from KPC while attracting professional management and strengthening governance.

“Although it is profit-making, the government gets just about Sh3 billion or Sh4 billion annually as dividends,” Mbadi previously stated. “I am sure that if we privatize KPC and retain just a 35% stake of ownership, we could make up to four or five times more out of that entity.”

Majority Leader Kimani Ichung’wah echoed this sentiment, arguing the privatization would enhance capital markets while insisting the State would still hold strategic control with its minority stake.

Despite being touted as a profitable move, the process, however, faced legal challenges. In August, the High Court briefly suspended the privatization following a suit questioning the plan's procedure and transparency. Those orders were lifted in mid-September, clearing the path for the parliamentary debate and vote.

With Parliament's approval secured, the government can now proceed to finalize the necessary legal and regulatory frameworks for the sale.