A long-running legal dispute between Zakhem International Construction Ltd and the Kenya Pipeline Company (KPC) has escalated after the Lebanese construction firm filed a fresh lawsuit demanding Sh10.6 billion in alleged unpaid contract dues.
The claim, reported on June 11, 2026, marks a significant intensification of a multi-year courtroom battle between the contractor and the state-owned utility over payments tied to a major infrastructure project.
Zakhem International argues that KPC has failed to clear outstanding balances arising from works completed under a 2014 contract initially valued at over $126 million (approximately Sh16 billion). The contract involved the construction of the 450-kilometre Mombasa–Nairobi Line 1 replacement pipeline project, one of Kenya’s most critical energy infrastructure developments.
This latest legal filing adds to a series of earlier disputes between the two parties. In previous cases, Zakhem has attempted to secure court orders to freeze and attach KPC bank accounts, including claims amounting to Sh926 million and another separate Sh500 million demand. These efforts have repeatedly been contested by KPC in court.
The company maintains that the matter was fully resolved under a mutual consent agreement reached in September 2023. According to KPC, all contractual obligations were settled and there are no outstanding payments owed to the contractor.
KPC has further argued that Zakhem’s repeated lawsuits amount to an abuse of the judicial process. The state-owned company maintains that the contractor is attempting to reopen issues that were already conclusively resolved, including attempts to adjust financial terms such as exchange rates after settlement.
Despite these objections, Zakhem has continued to pursue legal remedies, insisting that significant sums remain unpaid. The new Sh10.6 billion claim is expected to further intensify scrutiny of the long-running dispute, which has already generated multiple court filings and counterclaims over the past several years.
The case now adds another layer to an already complex legal battle involving one of Kenya’s key infrastructure agencies and an international contractor, with the outcome likely to have significant financial and contractual implications.
Source Attributed: The Standard