The National Oil Corporation (NOC) and Rubis Energy Kenya PLC have requested an exemption from the Competition Authority of Kenya (CAK) for a proposed non-equity Strategic Partnership Agreement, which would grant them exclusive rights for certain operations in Kenya’s downstream petroleum sector. The exemption, if approved, would allow both companies to bypass particular restrictive provisions under Kenya’s Competition Act for a period of eight years.
The partnership aims to enhance NOC’s downstream business operations, focusing on greater profitability and business expansion. According to the CAK notification, the agreement will prioritize NOC’s financial health while expanding its market share. “The proposed Strategic Partnership Agreement seeks to unlock financing and accelerate NOC’s transformation, ultimately benefiting the downstream energy sector in Kenya,” CAK Director-General David Kemei stated in the gazette notice.
Key components of the partnership include provisions for intellectual property sharing and brand recognition, ensuring that NOC’s branding aligns with Rubis’s corporate identity. Rubis, in return, will provide essential technical support, supply chain coordination, and access to shared technological infrastructure for NOC. The agreement includes “NOC’s exclusive right to engage with Rubis’s branding and modernization initiatives to further mutual interests in the market,” Kemei added.
The exemption application, as outlined in the gazette, lists several responsibilities that Rubis will assume, including “the implementation of operational strategies to promote value creation, financial efficiency, and enhanced brand awareness for NOC.” If approved, the partnership would also grant NOC a unique market advantage, enabling it to engage in specific downstream activities without direct competition within agreed parameters.
A joint committee would oversee the implementation, coordination, and evaluation of the partnership’s goals and performance. Both companies have committed to transparency, ensuring that any substantial operational adjustments will be reported to the CAK.
Submissions concerning this exemption request are open for public comment, with CAK accepting input through official channels by October 30, 2024.
