Uganda Secures Major KPC Operational Control Including Tariff Approval and CEO Veto Rights

Besides having the right to appoint and sack the chief executive officer of the Kenya Pipeline Company (KPC), Uganda has got its hands on some extremely valuable concessions when it comes to how the company is run. Uganda now has a say over big decisions like raising prices, setting dividend policies, overhauling the workforce and what happens when the company wants to sell new shares.

Amended Shareholder Rights

Following Uganda's big buy-up of a chunk of the company after its stock market float, the company's articles of association have been overhauled. Uganda bought its stake that ran from January to the end of February in 2026.

Kenya was forced to make some pretty big concessions to Uganda following the IPO because Uganda was threatening to walk away if things didn't go their way with regard to their rights as shareholders.

Powers that Uganda gets to approve

As a result, Uganda now gets to have a say in a number of big decisions, including the appointment and dismissal of the CEO of KPC, transport prices for fuel, changes to the board, and any changes to the company's dividend policy.

"As long as the National Treasury minister and the Ugandan government are able to put forward candidates for the board, then the following will need to be signed off on by both of them...we're talking about periodic reviews of pipeline transport and secondary storage prices so they can then be put to the relevant authorities for approval," one bit of the company's changed articles of association reads - which is a mouthful.

The actual documents also spell out that any shake-up of the workforce that gets done in the three years following the IPO will need Uganda's approval.

More things Uganda gets to have a say in

Uganda also got a say in other reserved matters, including issues with new shares in the company, changing the articles of association and getting rid of Kenyan or Ugandan government directors from the company board.

Impact on Tariffs and Revenue

KPC's revenue is heavily influenced by how much it charges for fuel - which is something that the Energy and Petroleum Regulatory Authority (Epra) gets to decide on, usually every three years. Just last time they went for a review, they set prices at 5.44 shillings per cubic meter for every kilometer. At the moment, Epra is looking at bumping that price up by 2.4 percent for the period between 2025 and 2028.

KPC flags this as a big regulatory risk and highlights the possible implications if they have any trouble getting price changes approved.

Financial Performance

KPC made 38.5 billion shillings in income for the last financial year, and shelled out 14.7 billion shillings on services. The mid-stream company in the oil and gas sector made a net profit of 7.49 billion shillings for the period - up a bit from the 7.4 billion it had the year before.

Uganda's Big Bet

In order to anchor the IPO, the Ugandan government went out and bought up shares worth 34.7 billion shillings - which was way more than the 21.1 billion shillings they were originally allocated, and gave them 20 percent of the company.

Uganda used that 20 percent to beef up their position on the board and get the right to pick the CEO.