Trade committee reviews SEZ law changes with Gulf Energy

NAIROBI, Kenya, Apr 6 – Lawmakers have engaged Gulf Energy over proposed changes to the Special Economic Zones (SEZ) law aimed at opening up Kenya’s oil and gas sector to more local investors.

The Departmental Committee on Trade, Industry and Cooperatives is reviewing the Special Economic Zones (Amendment) Bill, which seeks to extend tax incentives and concessions to upstream and midstream petroleum activities.

Gulf Energy backed the proposals, saying they would help local firms enter a capital-intensive sector traditionally dominated by multinationals, while improving Kenya’s competitiveness in the regional energy market.

The firm noted that petroleum projects often run for 10 to 25 years, and the proposed framework would enhance investor confidence, ease financing, and support infrastructure development.

It added that small and medium enterprises stand to benefit through lower costs, easier compliance, and increased access to investment, potentially boosting joint ventures, technology transfer, and job creation.

The company further argued that including upstream petroleum projects within SEZs would improve fiscal stability and address financing challenges, while also stimulating downstream industries such as refining, petrochemicals, fertilisers, plastics, and LPG production.

However, lawmakers raised concerns over potential revenue losses. Narok West MP Samuel Parashina warned that oil and gas firms already enjoy incentives under existing laws, cautioning that additional benefits could amount to double tax relief.

He cited planned exploration in South Lokichar and questioned whether the changes could reduce government revenue.

Other stakeholders who appeared before the committee included National Environmental Management Authority, the Kenya Revenue Authority, the Special Economic Zones Authority, and industry lobby groups.

The committee is expected to review stakeholder submissions before making recommendations on the proposed amendments.