Kenya court halts $370m sugar, biofuels project

Daniel Wallis, Reuters 13 Jul 08;

NAIROBI (Reuters) - A Kenyan court has temporarily halted a $370 million sugar and biofuels project in a coastal wetland that conservation groups warned would threaten wildlife and local livelihoods.

The government and the country's biggest sugar miller, Mumias, wants to plant cane on 20,000 hectares in the Tana River Delta to create jobs and plug an annual 200,000-tonne sugar deficit.

But the Malindi High Court ruled on Friday that environmentalists and groups representing local livestock keepers could apply for a judicial review, according to a copy of the order seen by Reuters on Sunday.

"This decision will make supporters of the project reflect on some of the issues raised at the public hearings," said Steve Itela, director of Kenyan campaigners Youth for Conservation.

"This should never have needed to go to court."

Kenya's National Environmental Management Authority (NEMA) cleared the project last month. But it has run into fierce opposition from activists who say it threatens 350 species including birds, lions, elephants, rare sharks and reptiles.

They accuse NEMA of ignoring a study showing irrigation in the area would cause severe drainage of the Delta, leaving local farmers without water for their herds during dry seasons.

Mumias, which owns 51 percent of the Tana Delta project, hopes to produce about 23 million liters ethanol -- which is distilled from molasses, a cane by-product -- there each year.

It says it will also generate 34 megawatts of electricity and create some 20,000 direct and indirect jobs, partly through the construction of an 8,000-tonne a day sugar mill.

The government, which has a 30 percent stake, says the project will benefit locals and that it has its full support.

Kenya produced 475,670 tonnes of sugar in 2006, and Mumias projects that it will generate an extra 200,000 tonnes annually from the Delta project.

Mumias chief executive Evans Kidero told Reuters in an interview on Thursday the firm was operating at full capacity again after post-election violence at the start of the year disrupted production and transport.

The company's pre-tax profits for the half-year ending December 2007 surged 38 percent to 564 million shillings ($9.11 million) from 436 million in the same period a year before.

Mumias, which is 20 percent owned by the government, currently produces 300,000 tonnes of sugar a year, 90 percent of it from some 66,000 smallholder farmers.

(Editing by Matthew Jones)

Nobel laureate Maathai warns Kenya over biofuel
Yahoo News 13 Jul 08;

Kenya will regret its failure to protect the environment, Nobel Peace Laureate Wangari Maathai said Sunday, as environmentalists battled to halt a government backed biofuels project.

"This country has failed to take environment issues seriously and that is very dangerous for posterity," Maathai told AFP.

"I am sorry that Kenyans are going to regret, in 20 to 30 years to come, why they let their government interfere with the environment, forests and wetlands," she added.

Maathai was speaking two days after a Kenyan court temporarily halted construction of a government-backed project where sugar was to be grown to generate power in coastal wetlands and opposed by environmentalists.

The government has approved the Tana Integrated Sugar Project, a 24-billion-shilling (369.3-million-dollar, 235-million-euro) operation on July 1.

Friday's ruling, from a court in the coastal town of Malindi, temporarily suspended work to allow environmentalists and local communities to apply for judicial review.

Conservationists and local communities have warned that loss of grazing and crops caused by the project would incur serious land damage in the protected area.

Britain's Royal Society for the Protection of Birds and Nature Kenya also oppose the project, which would cover more than 20,000 hectares (50,000 acres) of the Tana River Delta, saying it would damage the fragile ecosystem.

But Maathai stressed that it was up to local people and communities to oppose government projects that harmed the environment.

"We cannot just start messing around with the wetland because we need biofuel and sugar," she said.

Maathai won the 1994 Nobel Peace Prize for her Green Belt Movement which has planted some 30 million trees to counter forest loss and desertification in Africa.

The Tana Integrated Sugar Project aims to mill 8,000 tonnes of sugar cane daily, generating 34 megawatts of electrity and producing 23 million litres of ethanol a year.

Mumias Sugar Company owns 51 percent of the project, to be sited about 120 kilometres (75 miles) north of the port city of Mombasa.

The rest is owned by the state-run Tana and Athi River Development Authorities and local residents.

Demand for biofuels has been blamed as one of the factors contributing to the global food crisis that has sparked riots in many poor nations, including Kenya.