Tata Chemicals has claimed that it has already submitted the documents on developmental work done in Magadi and has been in active discussion with the Kenyan government on the issues raised.
Kenya’s President William Ruto had ordered Tata Chemicals to stop its operations in the country. Expressing his disappointment, he said, the company’s operations “failed to benefit” the African nation.
The company, in its latest statement, said it has provided a comprehensive response to the matters raised by the Ministry, including information regarding its compliance with applicable regulatory requirements. “We await the Ministry’s review of the submissions and its further direction,” it added.
Tata Chemicals has played an important role in the Kenyan economy since it acquired the Magadi plant in 2005, and continues to be an “integral part” of the company’s business, the statement said.
The company added that it respects the authority of the Government of Kenya and remains committed to constructive engagement through the appropriate legal and regulatory channels to resolve the outstanding matters. “Our priority continues to be the well-being of our employees, the Magadi community, our stakeholders in Kenya and continued economic development of Kenya,” it said.
Commercial operations at Lake Magadi had begun years before Tata’s acquisition, in 1911. The facility extracts trona, a naturally occurring mineral found around Lake Magadi, and processes it into soda ash, or sodium carbonate used in glass manufacturing, detergents, chemicals and water treatment. Tata Chemicals has a 100-year mining lease at Magadi.
Tata Chemicals says its Kenyan operation exports over 3.5 lakh tonnes of soda ash every year, accounting for 8-9 per cent of the total soda ash production capacity, to markets in Southeast Asia, India, the Middle East and Africa. The Kenyan government wants Tata Chemicals to undertake value addition of soda ash extracted and not just export the minerals.
Ruto said Kenya will bring in two companies to replace Tata’s operations — one to establish a large glass manufacturing business in Kajiado and another to manufacture chemicals locally.
The trigger for the current crisis came in July when Kenya’s Mining Cabinet Secretary Hassan Joho ordered Tata Chemicals Magadi to suspend all mining operations. The government cited a long list of unresolved issues for its harsh decision. The government wanted reconciliation of royalty, export reporting, mineral beneficiation and value addition, community development agreements, employment and skills transfer for Kenyan citizens, procurement from local suppliers and environmental compliance. The suspension also disrupted soda ash exports from the facility.