Kenyan tycoon in $30b coal dispute with Chinese investors

A company linked to Kenyan businessmen Peter Munga and George Kariithi is locked in a deepening dispute with Chinese investors from Fenxi Mining Industry Co. Ltd over rights to coal blocks C and D in Kitui’s Mui Basin. The deposits are valued at Ksh3.9 trillion ($30 billion), making the stakes unusually high for both sides.

Dispute over payments and control 

Tensions escalated after Fenxi accused Munga and Kariithi’s Great Lakes Corporation of failing to pay a required $3.875 million contribution to secure the concession. The Chinese firm has warned it may pursue arbitration in Mauritius, saying Kenya has allowed the obstruction to continue for more than a decade. 

Great Lakes maintains that a benefit-sharing agreement gave it a 30 percent stake in the venture and positioned the two parties as partners. The companies formed Fenxi Mui Mining Corporation Ltd in 2013 under a 70–30 split favoring the Chinese side. The consortium was to pay the government $5 million in concession fees — $1.125 million from Fenxi and $3.875 million from Great Lakes. 

Coal dispute puts Kenya at risk

Fenxi paid its share. Great Lakes did not. After years of missed deadlines, the Chinese company terminated the partnership in 2018 and proposed a new local partner, Dorse Gems International Ltd. Kenya has not approved the change. Fenxi says the delay has frozen development of the coal blocks and left its concession at risk. 

The Attorney-General later reviewed the dispute and determined that Fenxi, not Great Lakes, holds the legal concession. With a 60-day default notice now expired, Fenxi is preparing for international arbitration—a move that could expose Kenya to significant compensation claims if the Chinese firm prevails.

Munga’s rising legal troubles

Born in 1943, Munga built his reputation by transforming Equity Building Society, launched with Ksh5,000 ($38.5), into Equity Bank, one of Africa’s largest lenders with more than 20 million customers. His business interests span banking, insurance, agriculture and property. 

But Munga has faced a series of legal setbacks. A Kenyan court recently halted the sale of 75 million Britam shares after his wife claimed joint ownership, tied to an ongoing $5 million loan dispute. In October, he won a separate Ksh150 million ($1.2 million) TransCentury share case after a 14-year fight. In July, a court ordered him to vacate a 75-acre school property following a lease dispute with Del Monte. 

Kariithi’s role 

Kariithi, managing director of Fenxi Mui Mining Corporation, holds a majority stake in Great Lakes. He founded Karrymart Supermarket, a Nairobi retail chain facing supplier debt issues. His partnership with Fenxi on the Mui Basin project is at the center of one of Kenya’s most disputed mining projects.