Where there is a conflict between this Act and any other Act regarding upstream, midstream and downstream petroleum operations, this Act shall prevail.

For the avoidance of doubt, a provision of any Act that provides for a person or body to grant or deny any permission for any work shall not be construed as granting that person or body any power in relation to upstream petroleum operations.

The Cabinet Secretary shall develop and publish a national policy on petroleum operations which shall be reviewed at least once in every five years.

The Cabinet Secretary shall ensure that relevant stakeholders participate effectively in the making of the national policy on petroleum operations.

Within three months after the end of each financial year, the Cabinet Secretary shall prepare and publish on its website and in at least two newspapers of national circulation a report on the implementation of the national petroleum policy.

The Cabinet Secretary shall develop, publish and review a national petroleum strategic plan.

The petroleum strategic plan shall take into account the national petroleum policy and serve as a guide for the implementation of the national policy on petroleum operations.

The Cabinet Secretary shall prescribe Regulations in relation to the content and timelines for the preparation of the petroleum strategic plan.

No person shall engage in any petroleum operations in Kenya without having previously obtained the approval of the Cabinet Secretary or Authority in such manner, in such form and on such terms as are prescribed by this Act.

Any upstream petroleum operations shall be conducted in accordance with the provisions of this Act and the terms and conditions of a petroleum agreement.

Subject to this Act, and in accordance with the terms and conditions of a petroleum agreement, the national government may authorize a contractor to engage in upstream petroleum operations within a specified area.

Notwithstanding the provisions of this section, the national government may grant to any person, other than the contractor, a permit for the prospecting and mining of minerals or other natural resources other than petroleum or the conduct of operations other than upstream petroleum operations within an area covered by a petroleum agreement:

Provided that the prospecting, mining or other operations shall not interfere with upstream petroleum operations.

The national government may participate in any phase of upstream petroleum operations in accordance with the terms and conditions of a participation agreement entered into between the national government and the contractor.

The national government shall create a conducive environment for investments in petroleum operations and infrastructure development, including formulation of guidelines in collaboration with relevant national government agencies on development of petroleum investments and to disseminate them among potential investors.

The national government shall ensure that petroleum operations and infrastructure development are carried out for the benefit of the people of Kenya.

In its effort to promote petroleum operations and investments, the national government shall facilitate access to land for exploration activities in accordance with the Constitution and any other written law.

Where the Cabinet Secretary rejects the recommendations of the Authority under this section, the Cabinet Secretary shall provide the Authority the reasons of such refusal in writing, within fourteen days.

The Cabinet Secretary or his authorized representative may engage a person who has relevant expertise to assist in any matter of inspection, testing or examination.

A person who is an occupier of or is in charge of any building, structure, place, vehicle, vessel, aircraft, machinery or equipment shall provide the Cabinet Secretary or his authorized representative with all reasonable facilities and assistance to carry out his or her duties under this Act.

Where a contractor has failed to perform an act or do anything as may be provided for in a petroleum agreement, the Cabinet Secretary may, by notice in writing to a contractor, direct the contractor, consistent with best petroleum industry practices, as to any matter with respect to which regulations may be made under section 127.

Where a contractor fails or neglects to comply with the direction of the Cabinet Secretary in accordance with this section, the Cabinet Secretary may cause to be done all or any of the things required by the direction to be done, and the costs and expenses incurred in doing those things shall be a civil debt due to the National Government from the contractor.

There is established a committee to be known as the National Upstream Petroleum Advisory Committee.

The Director-General of the Authority shall be the secretary to the Advisory Committee.

The Advisory Committee may co-opt such other members as they deem necessary but in any case not more than four members shall be co-opted.

The Advisory Committee shall, in co-opting members to sit in the Committee, ensure that the persons co-opted have the necessary knowledge and experience in the matters under consideration by the Committee.

Where the Cabinet Secretary rejects any advice given under this section, the reasons for the rejection shall be communicated in writing to the Advisory Committee within fourteen days.

All petroleum existing in its natural condition in strata lying within Kenya and its continental shelf is vested in the National Government in trust for the people of Kenya.

All upstream petroleum resources in subsection (1) shall be managed in accordance with the provisions of the Constitution, this Act and the regulations made thereunder.

For the purposes of this Act, the Cabinet Secretary after consultation with the Advisory Committee may, by notice in the Gazette, divide Kenya and its continental shelf into numbered areas which shall be defined by specific geographical co-ordinates, and each area shall be described as a "block".

The Cabinet may reserve any number of blocks for exploration by the national government.

An application under this section shall be accompanied by the requisite information to be specified in the Regulations.

A person who engages in upstream petroleum operations without executing a petroleum agreement with the Cabinet Secretary or obtaining a non-exclusive exploration permit from the Authority commits an offence and upon conviction shall be liable to a fine not exceeding twenty million shillings or to imprisonment for a term not exceeding ten years or to both.

Where the national government enters into a petroleum agreement, under this Act, it shall do so fairly, equitably, transparently, competitively and cost effectively:

Provided that the national government shall enter into a petroleum agreement only with a contractor who shall have the financial, technical and professional capacity necessary to fulfil the contractor's obligations under the petroleum agreement.

The contractor shall maintain financial, technical and professional capacity throughout the length of the contract.

The contractor shall at all times ensure that any subcontractor or agent of the contractor acting on his behalf possesses the necessary skills and qualifications to meet the obligations of the contractor stipulated in the petroleum agreement or as required under this Act.

Subject to section 23 the Cabinet Secretary shall negotiate, award and execute a petroleum agreement, on behalf of the national government, in the form prescribed in the Schedule to this Act.

A petroleum agreement may be executed between the Cabinet Secretary and a contractor after the conclusion of bidding rounds conducted in accordance with this Act.

Where the Cabinet Secretary intends to negotiate directly with a contractor in accordance with this section, the Cabinet Secretary shall publish a notice of thirty days on the website of the Ministry, in the Gazette and in at least two newspapers of national circulation.

The Cabinet Secretary shall inform all the bidders of the bidder to whom a block has been awarded.

The Cabinet Secretary shall, upon concluding negotiations under this section, publish a notice on the website of the Ministry, in the Gazette and in at least two newspapers of national circulation, information with respect to the contractor to whom the Cabinet Secretary has awarded a block and the outcome of such negotiations.

If a party to a bidding round or direct negotiations is dissatisfied with the award of the bidding round or direct negotiations, an appeal may be made to the Tribunal in the first instance.

The contractor shall have an exclusive right to explore and exploit petroleum in the contract area subject to the provisions of this Act and the petroleum agreement.

The contractor shall appoint an operator in relation to the petroleum agreement.

A contractor may substitute one operator for another operator as may be provided for in the petroleum agreement and in this Act.

The public shall be informed of the changes of an operator by way of a Gazette notice, a newspaper of nationwide circulation and a radio of local coverage in the area in which the operations are being undertaken.

A person who intends to carry out a non-exclusive exploration survey shall apply to the Authority for a non-exclusive exploration permit in the prescribed form and accompanied by the prescribed fee.

The Authority shall issue a non-exclusive exploration permit for a geographically delineated area.

The Authority may issue non-exclusive exploration permits to different persons in respect of different non-exclusive exploration activities in the same geographically delineated area.

A person who has been issued with a non-exclusive exploration permit shall provide to the Authority copies and samples of all the data collected by that person.

A person who conducts a non-exclusive exploration survey without being issued with a non-exclusive exploration permit by the Authority commits an offence and upon conviction shall be liable to a fine of not less than Kenya shillings ten million or to a term of imprisonment of not less than two years or both.

The Authority may issue an applicant with a non-exclusive exploration permit and the Authority may impose such conditions as it may deem fit on the permit.

The Authority shall inform each County Government affected by the non-exclusive exploration activities of the nature and status of such non-exclusive exploration activities.

A contractor who intends to conduct upstream petroleum operations shall apply to the Authority for an operational permit.

The provisions of section 23(2) shall apply with respect to operational permits under subsection (1).

A contractor shall apply to the Authority for an operational permit for each well.

A contractor shall identify each by a unique designation indicating the block name and the basin in which it is located.

The Authority, in collaboration with the contractor and any other relevant stakeholder, shall give the local community in a place where upstream petroleum operations are to be permitted adequate opportunity to participate in the process of reviewing and awarding permits under this Act.

A person who contravenes the provisions of this section commits an offence and upon conviction shall be liable to a fine of not less than ten million shillings or to a term of imprisonment of not less than two years or both.

On or before the commencement of the initial exploration period or of any additional exploration period the contractor shall provide a security, in such form to be prescribed in the petroleum agreement guaranteeing the contractor's minimum work and expenditure obligations.

Where a contractor is in default of the contractor's minimum work and expenditure obligations, the Cabinet Secretary may, by reasonable notice in writing served on the contractor, suspend or terminate the petroleum agreement and promptly recall the security.

A contractor shall not transfer an interest in a petroleum agreement executed in accordance with this Act without the written permission of the Cabinet Secretary.

The Cabinet Secretary shall not unreasonably withhold permission for the transfer of an interest in a petroleum agreement by the contractor to another person unless there is reason to believe that the transfer of that interest shall be against public interest or safety.

This section applies to any direct or indirect transfer of interest or participation in the petroleum agreement, including the assignment of shareholding and other ownership shares that may provide control of a contractor possessing a participating interest in the petroleum agreement.

A contractor shall obtain the permission of the Cabinet Secretary before the contractor transfers or charges the contractor's fixed facilities.

The Cabinet Secretary and the contractor shall inform the National Government agency responsible for collection of taxes and revenues of all approvals for the transfer, assignment or trade of interest in a petroleum agreement within twenty days after the approval.

A holder of an interest in a petroleum agreement shall notify the Cabinet Secretary whenever there is any change in the ownership or control of a company or any joint venture company with an interest in the petroleum agreement, and the holder of the interest and the new owner shall give a written commitment to the Cabinet Secretary that they shall continue to honour the obligations prescribed in the petroleum agreement.

A company, other than a listed company, that has executed a petroleum agreement shall not transfer its shares or stocks to any person without the permission of the Cabinet Secretary.

Notwithstanding any other payments that may be applicable for the transfer of shares and stocks by a company that is a party to a petroleum agreement, the Cabinet Secretary may charge such fees for the transfer as may be prescribed in Regulations.

A person who contravenes the provisions of this section commits an offence and on conviction, shall be liable to a fine of not less than ten million shillings or to imprisonment for a term of two years or to both.

Where a contractor discovers the existence of petroleum or any other resource in Kenya, that contractor shall notify the Cabinet Secretary within forty eight hours of the discovery.

A contractor who notifies the public of the discovery of petroleum or any other resource without having reported the discovery to the Cabinet Secretary or who notifies the public of the discovery without the approval of the Cabinet Secretary commits an offence and on conviction shall be liable to a penalty of not less than twenty million shillings.

Where any other natural resource is discovered in the course of exploration or production of petroleum, the Contractor shall inform the Cabinet Secretary of the discovery and, where relevant, the Cabinet Secretary shall inform the Cabinet Secretary responsible for matters related to in the other natural resource.

A contractor shall give the Authority a notice of thirty days where the contractor intends to abandon a well.

A contractor shall obtain the written permission of the Authority to close or plug a well.

A person who contravenes the provisions of this section commits an offence and upon conviction shall be liable to a fine of not less than twenty million shillings or to a term of imprisonment of not less than five years or both.

A contractor shall surrender all or part of the block in accordance with this Act and the terms of the petroleum agreement.

Where a contractor intends to partially surrender a block, that contractor shall surrender contiguous portions of the block in accordance with this Act and the manner specified the petroleum agreement.

Where a contractor intends to partially surrender a block, that contractor shall submit to the Cabinet Secretary and the Authority the geological and geophysical data in relation to the block.

The surrender of any block shall not affect any liability on the part of the contractor incurred prior to the date of surrender in respect of the block.

Where a contractor surrenders a block or partially surrenders a block, that contractor shall meet that contractor's obligations under the terms of the petroleum agreement, including obligations in relation to decommissioning costs.

Where a commercial field is established, such field shall be developed by the contractor within such time as may be prescribed in this Act and the petroleum agreement.

The field development plan shall be submitted by the contractor to the Authority for review in accordance with the petroleum agreement.

The Authority shall advise the Cabinet Secretary before approval of the field development plan.

The Cabinet Secretary shall, within thirty days of the approval of a field development plan submitted in accordance with the terms of a production sharing contract entered into under this Act, submit the production sharing contract together with the field development plan to Parliament for ratification in accordance with Article 71 of the Constitution.

Parliament shall, in carrying out its obligation under subsection (2), undertake public participation.

The Cabinet Secretary shall, upon accordance refusal under subsection (2)(b), consider the reasons and reservations on their merits and resubmit the same to Parliament for approval.

If Parliament does not make a decision under subsection (2) within ninety days, the production sharing contract and the field development plan shall be deemed to have been ratified.

The contractor shall inform the Authority of any significant deviation in or alteration of the terms and conditions under which a field development plan has been submitted or approved as well as any significant alteration of facilities or use of facilities.

On receiving information under subsection (1), the Authority may approve the variation or alteration of terms and preconditions under which a plan has been submitted or approved as well as any significant alteration of facilities, or may in the alternative require a new or amended plan to be submitted for approval.

A person who contravenes the provisions of this section commits an offence and on conviction, shall be liable to a penalty of not less than ten million shillings or to imprisonment for a term of two years or to both.

Any person who contravenes the provisions of subsection (1) commits an offence and is liable on conviction to a fine of not less than twenty million shillings or to imprisonment for a term of not less than five years or to both.

Subject to the provisions of section 28, where a contractor discovers petroleum or any other resource in the area where the contractor is authorized to conduct upstream petroleum operations and the discovery extends beyond that area, the contractor shall inform the Cabinet Secretary within seven days of the discovery.

Where a discovery is made under this section extends to an area where a separate petroleum agreement operates, the Authority may require that the petroleum or other resource shall be developed and produced in accordance with a unitization agreement.

A unitization agreement shall be an agreement between contractors who hold separate petroleum agreements on blocks that are adjacent or contiguous to each other for the joint development or production of petroleum from the separate blocks.

Where the Authority requires contractors to develop or produce petroleum under a unitization agreement, the contractor shall prepare a joint development and production for the petroleum and submit the plan to the Authority for review within eighteen months from the date of the making of the unitization agreement or some longer period as the Authority may determine.

Where the contractors fail to prepare a joint development and production plan within the prescribed period, the Authority may authorize another person to prepare the joint development and production plan and the costs for the preparation of that plan shall be borne by the contractors.

The consultant provided for in the subsection (5) shall consult with and keep all the parties informed of its work at all times.

Where the adjacent area contemplated in subsection (1) is not subject to a petroleum contract, the Authority may recommend that the subject petroleum deposit shall be developed pursuant to a unitization agreement and shall advise the Cabinet Secretary to arrange for the licensing of the adjacent area in accordance with this Act.

A person who owns infrastructure used for upstream and midstream petroleum operations shall provide access to that infrastructure to third parties under such reasonable conditions:

Provided that there are no significant technical challenges that shall prevent the utilization of the infrastructure by third parties.

An agreement for the use by third parties of the infrastructure for upstream and midstream petroleum operations shall be submitted to the Authority for approval by the owner of the infrastructure.

A contractor engaged in upstream petroleum operations in accordance with a petroleum agreement shall not have proprietary rights or control of any downstream petroleum operations.

Despite subsection (1), where the contractor conducting upstream petroleum operations is a subsidiary company of another company, that other company may conduct midstream or downstream operations or another subsidiary company of that other company may conduct midstream or downstream petroleum operations.

A contractor shall submit a field decommissioning plan to the Authority before a production permit to install and operate the facilities is issued.

The plan referred to in subsection (1) shall contain proposals for continued production or shut down of production, decommissioning of facilities and any other information required under the regulations.

The decommissioning of facilities referred to in subsection (2) may constitute further use of the facilities in the upstream petroleum operations, other uses, complete or partial removal and disposal or abandonment.

The Authority may on receipt of the plan require further information and evaluation, or may require a new or amended decommissioning plan.

The contractor may from time to time as directed by the Authority update the decommissioning plan as shall be provided for in the regulations made under this Act.

There shall be established a decommissioning fund for each development area or for other facilities operated in relation to a production permit under this Act for the purpose of costs related to the implementation of a decommissioning plan as provided in the petroleum agreements.

The decommissioning fund shall be applied to the implementation of activities approved in the decommissioning plan.

For every subsequent first calendar quarter in which petroleum is produced or a facility operated, the Authority shall charge the contractor a portion of the estimated future cost for decommissioning of facilities to be deposited in the fund.

The amount deposited in the decommissioning fund shall be charged as operating cost subject to the cost recoverable limitations stipulated in the petroleum agreement or as may be provided by regulations.

Where the decommissioning fund is not sufficient to cover the implementation of the decommissioning plan, the contractor, and where applicable, the owner of the facilities shall cover the costs and expenses.

Where any amount remains in the decommissioning fund after the decommissioning plan has been implemented, such funds shall be distributed pro rata between the contractor and the National Government where the National Government has participating interest.

The management of the decommissioning fund shall be done by a committee consisting of representatives of the National Government, County Government and the contractor, in such manner as may be prescribed by regulations.

The contractor shall notify the Authority of the date and time of intended termination of use of a facility if the said use is expected to terminate permanently before the expiry of the production permit.

Decommissioning shall be scheduled to occur after a producing field reaches its economic limit.

Decommissioning shall be carried out as provided for in this Act, the petroleum agreement and the decommissioning plan.

The Authority may issue directions relating to the time limit for disposal of decommissioned facilities:

Provided that all decommissioned facilities shall revert to the National Government.

Directions issued under subsection (1) shall take into consideration factors such as the economic efficiency, technical viability, safety and any environmental concerns as well as consideration for other users.

A contractor shall comply with the directions of the Authority regarding the disposal or decommissioning of upstream petroleum operations even where a production permit has lapsed.

Where the ownership of a facility has been transferred in accordance with this Act, the contractor and the owners shall comply with the directions of the Authority in relation to the disposal or decommissioning of the facilities.

The Authority direct that facilities used in upstream petroleum operations shall continue to be used for upstream petroleum operations by another contractor or for other purposes and the other contractor or other user of the facilities shall comply with the directions of the Authority regarding the disposal or decommissioning of the facilities.

Where directions relating to the disposal or decommissioning of a facility are not carried out by a contractor or a user authorized by the Authority as directed by the Authority, the Authority may take the necessary measures on behalf of the contractor or that other user.

Where the Authority takes any measures under subsection (6) on behalf of a contractor or that other user, any risks or costs incurred arising out of that measure, shall be borne by the contractor or that other user as the case may be.

A direction given under subsection (1) shall be consistent with best petroleum industry practices, and nothing in this section or in any direction shall be construed as requiring any person serving or having served as the contractor to do anything contrary to best petroleum industry practices.

A person to whom directions are given under subsection (1) who refuses or neglects to comply with such directions within the period specified in the notice, commits an offence and shall on conviction be liable to a fine not less than ten million shillings or imprisonment for a term not exceeding two years or both.

A person obligated to implement directions relating to disposal of a decommissioned facility under this part shall be liable for damage or loss arising in connection to the disposal of the facility or other implementation related thereto.

Where the contractor abandons a facility, the contractor shall be liable for any damage or loss caused in connection with the abandoned facility.

Where there is more than one party liable under sub section (1) or (2), they shall be held jointly and severally liable for all financial obligations, penalties and/or liabilities.

Where a decision is made to abandon the facility, it may be agreed between the contractor and the National Government that future maintenance, responsibility and liability be assumed by the National Government based on agreed financial compensation as provided for in the regulations.

A person shall not be excused from furnishing information or data or answering a question when required to do so under this section on the ground that the information or data so furnished or the answer to the question might tend to be incriminating or expose them to liability or penalty.

Where any information or data is furnished pursuant to a requirement under subsection (1)(c), the person to whom it is made available may make copies or take extracts from the data.

For the purpose of subsection (1) the contractor shall before engaging in petroleum operations prepare and submit a long term and annual local content plan which corresponds with the work program to the Authority for approval.

The Cabinet Secretary may make Regulations regarding local content in petroleum operations.

The Authority shall supervise, co-ordinate, and manage the development of local content.

Any institution wishing to provide human capital development, build knowledge and technical capacity in upstream petroleum operations must be accredited in accordance with Regulations made under section 127.

There shall be established a fund to be known as the Training Fund for the purpose of training Kenyan nationals in upstream petroleum operations.

All moneys raised by the contractors as training contribution shall be paid into the Training Fund.

The Training Fund shall not be managed except as shall be prescribed by the Cabinet Secretary in accordance with the provisions of this Act and regulations made under section 127.

All moneys from the Training Fund shall be used only for the purpose for which the Training Fund is created.

For the purposes of this section, the training contribution shall be such amount as is specified in the petroleum agreement.

The contractor shall comply with financial and fiscal obligations in the implementation of the petroleum agreement under this Act and any other written law.

The contractor shall pay to the National Government all taxes, relevant fees and levies in such manner as may be prescribed by both the petroleum agreement and any other relevant laws.

Taxes, profit petroleum and royalties from upstream petroleum operations shall be collected in accordance with the relevant tax laws and accounts provided to the National Government agency responsible for collection of taxes in the manner it prescribes.

Where a person fails to make a payment under this Act when the amount falls due, the person shall pay such penalty as shall be prescribed in the production sharing contract or any other petroleum agreement. Such penalty shall be without prejudice to the National Government exercising any other remedies available in law.

The holder of a petroleum agreement shall pay annual fees as may be prescribed by a petroleum agreement and regulations.

The annual fees under subsection (1) shall be payable on the grant of a petroleum agreement and thereafter annually on the anniversary of the grant until the termination of the petroleum agreement.

Prior to the award of the petroleum agreement the contractor shall pay to the National Government such signature bonus as shall be prescribed in the petroleum agreement.

In this section, "signature bonus" means a single, non-recoverable lump sum payment by the contractor to the National Government upon execution of the petroleum agreement.

The profit derived from upstream petroleum operations shall be shared between the contractor and the National Government in accordance with the petroleum agreement.

The national government's share of petroleum revenues before the imposition of taxes shall be deposited into a dedicated petroleum fund, and managed in accordance with the Public Finance Management Act (Cap. 412A) and any other relevant law.

The national government's share of the profits derived from upstream petroleum operations shall be apportioned between the national government, the county government and the local community.

The county government's share shall be equivalent to twenty percent of the national government's share.

The local community's share shall be equivalent to five percent of the national government share and shall be payable to a trust fund managed by a board of trustees established by the county government in consultation with the local community.

The respective county government shall legislate on the establishment of the board of trustees and the prudent utilisation of the funds received under this section for the benefit of present and future generations.

Parliament shall review the percentages under this section within ten years.

A contractor shall carry out upstream petroleum operations in the contract area in accordance with all the applicable environment, health, safety and maritime laws and best petroleum industry practices.

A contractor shall ensure that the management of production, transportation, storage, treatment and disposal of waste arising out of upstream petroleum operations is carried out in accordance with all the applicable environmental, health, safety and maritime laws and best petroleum industry practices.

A contractor may contract a separate entity to manage the transportation, storage, treatment, spillage or disposal of waste arising out of upstream petroleum operations.

For the avoidance of doubt the contractor shall remain responsible for the activities of the entity referred to under subsection (2).

A person contracted by the contractor under subsection (2) shall not carry out those activities without being registered and licensed by the National Government agency responsible for environment and any other relevant entity.

A person who carries on the management of the production, transportation, storage, treatment, clean up or disposal of waste arising out of upstream petroleum operations without a license or fails to comply with the terms and conditions prescribed in the license issued under subsection (4) commits an offence and is liable on conviction to a fine of not less than twenty million shillings or imprisonment of not less than five years or both.

Subsection (1) shall not apply in relation to any structure, equipment or other property that was not brought into the area subject to the petroleum agreement by or with the authority of the contractor.

A contractor who contravenes subsection (1) commits an offence and shall on conviction, be liable to a fine of not less than one million shillings or to a jail term of not less than six months or both.

A contractor shall not vent or flare natural gas in the course of the conduct of upstream petroleum operations except with the prior authorization of the Authority in consultation with the National Government agency responsible for environment and safety and any other National Government entity.

A contractor under subsection (1) shall carry out the venting or flaring in accordance with the terms and conditions of the consent, existing laws and best petroleum industry practices.

Notwithstanding subsection (1), the prior consent of the Authority shall not be required in the case of an emergency and where such venting or flaring is necessary to avert a disaster.

Any application to the Authority in respect of proposed flaring of oil or natural gas shall include an evaluation of reasonable alternatives to flaring that have been considered along with information on the amount and quality of oil or natural gas involved and the duration of the requested flaring.

In considering the application under subsection (1) and (5), the Authority shall be satisfied that flaring is necessary to safeguard the health and safety of persons in the contract area or to prevent damage to the property of any person.

A contractor who contravenes, fails or neglects to comply with a requirement of this section commits an offence and shall on conviction be liable to a fine of not less than one hundred million shillings or a jail term of not less than ten years or both.

A person engaged in any undertaking or activity pursuant to a petroleum agreement or permit issued under this Act shall notify the Authority within forty eight hours in writing, in the form and manner prescribed by the Authority, of any accident or incident causing loss of life, personal injury, explosion, oil spill, fire or any other accident or incident causing harm or damage to the environment or property which has arisen in Kenya or within Kenya's Exclusive Economic Zone or Outer Continental Shelf.

The Authority may direct an investigation to be carried out into any accident or incident under subsection (1) and take such action as it deems necessary.

The contractor shall ensure that the persons referred to in subsection (1) (a) are duly informed of those precautions and that the contractor has secured the requisite insurance to cover any such eventualities.

A contractor and any other participant in upstream petroleum operations shall, at all times maintain efficient measures for emergency preparedness with a view to dealing with incidents which may lead to loss of life or personal injury, pollution or damage to property.

The contractor shall ensure that the measures taken to prevent or reduce harmful effects, include measures to ensure that the environment is restored as much as possible to its original condition prior to commencement of operations.

The contractor shall initiate and maintain emergency preparedness measures to prevent and mitigate against any hazards occurring within facilities and shall at all times have contingency plans to deal with such emergencies.

The contractor shall place facilities at the disposal of the relevant authorities for emergency and security drills and shall, where necessary, participate in such drills.

As far as is practicable, the contractor shall involve the Authority, National Environment Management Authority, the Council of Governors and the relevant local communities in the preparation of emergency preparedness measures.

The Cabinet Secretary shall establish a disaster preparedness, prevention and management unit within the Ministry to co-ordinate response to accidents, disasters and other emergencies that may occur within upstream petroleum operations.

The disaster preparedness, prevention and management unit shall collaborate with the National Disaster Operations Centre, County Governments and other relevant institutions to ensure a timely response and emergency preparedness resource sharing.

The Cabinet Secretary shall formulate and periodically update a risk assessment of upstream petroleum operations and implement appropriate risk mitigation programs.

The disaster preparedness, prevention and management unit shall in liaison with the contractor carry out public awareness and sensitisation forums for local communities resident in areas surrounding ongoing Upstream Operations.

There shall be a safety zone surrounding every facility carrying out upstream petroleum operations, unless otherwise determined by the Cabinet Secretary on advice by the Authority.

The Cabinet Secretary may upon advice by the Authority, in cases of accidents and emergencies establish or extend the safety zones under subsection (1).

The extent of the safety zones referred to in subsection (1) and (2) shall be determined by the Cabinet Secretary in consultation with the Authority; except where a safety zone extends across the border line with another state, the Cabinet Secretary shall consult Parliament.

Where an accident or an emergency occurs, the contractor or other person responsible for the operation and use of the facility shall, to the extent necessary, suspend the upstream petroleum operations for as long as the requirement of prudent operations warrants.

Where special circumstances exist, the Cabinet Secretary may order that upstream petroleum operations be suspended to the extent necessary, or may impose particular conditions to allow continuation of the activities.

The contractor shall at all times ensure that any person carrying out work for the contractor possesses the necessary skills and qualifications to perform the work in a prudent manner in accordance with regulations made under this Act.

A person may make an application for a licence, permit or certificate to the licensing authority in the manner prescribed by this Act or the licensing authority.

Where the licensing authority rejects an application for the grant a licence, permit or certificate, the licensing authority shall give to the applicant reasons for the refusal in writing within seven days of such refusal.

A person who wishes to carry out the supply of petroleum products by means of a retail dispensing station, or of gas through a centralised reticulation system, must have a licence issued by the County Government:

Provided that any retail dispensing station or gas reticulation system complies with section 86 on construction permits and are operated in accordance with National guidelines published by Authority.

A licence or permit issued under this Act may not be altered, revised or modified, except with the consent of the licensee.

An application for renewal of a licence, permit or certificate shall be made at least thirty days before the expiry date of the existing licence, permit or certificate and shall be accompanied by the prescribed fee.

If the licensing authority is satisfied that the applicant continues to meet the requirements of the licence, permit or certificate, the licensing authority shall renew the licence, permit or certificate.

Where an application for renewal of a licence, permit or certificate has been made before the expiry of the licence, permit or certificate but has not been approved or rejected by the licensing authority when the licence, permit or certificate is due to expire, the licence, permit or certificate continues in force until the application for renewal is dealt with and any renewal in such a case shall be taken to have commenced from the day when the licence, permit or certificate would have expired before the renewal.

A licence or permit shall specify the nature of petroleum business and the premises at which the licensee may conduct his business and where a petroleum business is conducted at more than one premise, a separate licence or permit shall be required for each of such premises.

A person who conducts petroleum business at more than one premise, without obtaining a separate licence or permit for each of such premises, shall be liable to a penalty equivalent to twenty per cent of the licence, permit or certificate fee to be imposed by the Authority.

A person may make an application for amendment of a licence, permit or certificate.

An application under subsection (1) shall be in the prescribed manner and be accompanied by the prescribed fee.

The licensing authority may amend the licence, permit or certificate and endorse it accordingly.

Where an application to amend a licence, permit or certificate is rejected, the licensing authority shall notify the applicant of the reasons in writing.

A licence, permit or certificate amended under this section shall retain the existing expiry date.

An applicant dissatisfied with the decision of the Cabinet Secretary under subsection (2), may appeal to the Tribunal within thirty days of the receipt of such decision.

A licensee or permit holder shall cause to be displayed with the premises, the licence or permit, or a certified copy.

A licensee or permit holder who contravenes subsection (1) commits an offence and shall be liable on conviction to a fine not exceeding one million shillings.

Unless otherwise specified in the licence or permit, the licensing authority may give a licensee fourteen days' notice to show cause why the licence or permit should not be revoked.

The licensing authority shall determine the matter within thirty days from the expiry of the notice.

A suspension or revocation of a licence or permit shall not indemnify the licensee against any penalties for which such person may have become liable under the Act.

A licensee or permit holder may apply for replacement of a licence, permit or certificate.

A licensee or permit holder may apply for replacement of a licence, permit or certificate where it is lost, destroyed or defaced.

The licensing authority shall, upon payment of the prescribed fee, issue a duplicate licence, permit or certificate to the licensee.

A licensee shall not transfer or otherwise divest any rights, powers or obligations conferred or imposed upon the licensee by the licence or permit without the consent of the licensing authority.

The licensing authority shall satisfy itself of the legal, technical and financial competence of the transferee to carry out the undertaking.

The transferee shall undertake in writing to comply with the conditions of the licence or permit.

The licensing authority shall not withhold any consent to any application to transfer unless it has reason to believe that public interest is likely to be prejudiced by the transfer.

Subject to subsection (3), any person may, during official working hours, and upon payment of the prescribed fee, inspect the register of licences and permits.

A person who intends to construct a pipeline, refinery, bulk storage facility, retail dispensing site, centralized gas reticulation system or designated parking place for petroleum tankers shall, before commencing such construction, apply in writing to the licensing authority for a permit to do so.

The licensing authority shall consider every application received under this section and shall, if satisfied that the applicant meets the prescribed requirements, grant to the applicant, within forty five days, the permit to construct a pipeline, refinery, bulk storage facility, bulk liquefied petroleum gas facility, natural gas facility, retail dispensing site, centralised gas reticulation system or designated parking, as the case may be.

A permit shall be subject to such conditions as maybe prescribed.

Where the licensing authority refuses to grant a permit under this section, it shall notify the applicant of such refusal specifying the reasons thereof and shall deliver such notice to the applicant.

Where a permit contains conditions prescribed in subsection (2)(d), no person shall, before the conditions are satisfied, use any works the execution of which was authorised by the permit, except to the extent specified in a notice given by the licensing authority to the licensee specifying the extent to which the works may be used, notwithstanding that some of the conditions have not been satisfied and such permit may, at any time, be revoked by the licensing authority in a subsequent notice in the Gazette.

A notice given by the licensing authority under subsection (3) shall be conclusive evidence for the purposes of this Act that those conditions have been satisfied.

Where a permit referred to in subsection (3) is cancelled or otherwise ceases to be in force prior to the completion of the authorised works, the licensee shall, to the extent of partially executed works, be deemed to have satisfied the prescribed conditions.

Subject to subsection (2), the licensing authority may, by notice in the Gazette, suspend or revoke a construction permit if any term or condition thereof has not been complied with within the prescribed period.

Where the licensing authority intends to revoke or suspend a permit under this section, it may, at least twenty-one days before the date of the intended revocation or suspension, notify the holder of the permit of such intention, specifying the reasons thereof, and shall take every precaution to ensure fairness in the exercise of this power.

The licensing authority may in writing, reinstate a permit revoked or suspended under subsection (1) if satisfied that the reasons for the revocation or suspension no longer exist.

If the owner or occupier of the facility in sub section (1) fails to remove the works, the licensing authority shall decommission the works at the cost of that person.

Notwithstanding subsection (1), any person who constructs a pipeline, refinery, bulk storage facility, retail dispensing site or a centralized gas reticulation system without a permit is liable on conviction to a fine of not less than one million shillings.

A person who offers for sale in Kenya or transports or stores petroleum meant for use in Kenya shall ensure that the specifications of such petroleum conforms to the relevant Kenya Standard, but where no such standard exists, the relevant international standards approved by the Kenya Bureau of Standards: Provided that no person shall divert to sell in Kenya, goods destined for other markets.

A person licensed to operate a common user facility shall provide non-discriminatory open access to its facility for use by any licensee or person on payment of fair and reasonable charges as shall be prescribed in regulations made under this Act.

A licensee shall promptly evacuate its petroleum products held by a common user logistic facility in accordance with this Act.

Where any licensee wilfully delays to comply with the terms of the contract pursuant to subsection (1), the Authority may compel the licensee to evacuate the petroleum products when appropriate and in the event of the licensee failing to comply with such direction the Authority may order disposal of such products held by a common user logistic facility and impose such penalties and fines as may be prescribed in regulations.

Every person licensed to operate a common user facility shall use a form of contract approved by the Authority which shall set out the rights and responsibilities of the licensee and users of the facility, as the case may be.

A person engaged in petroleum business shall comply with the applicable environmental, health and safety laws.

In the event of a fire, explosion, oil spill, injury or fatality occurring in the course of operating a petroleum logistics facility, transportation or sale of petroleum, either by accident or through negligence, the operator or person transporting or selling the petroleum shall forthwith clean up the polluted or damaged environment, at the operator's own expense, to the satisfaction of the licensing authority and any other relevant authority.

Provided that any person engaged in the storage, transportation or sale of petroleum and petroleum products shall have an oil clean-up plan in compliance with the National Oil Spill Policy, relevant environmental health and safety regulations or guidelines.

If the operator or person transporting or selling petroleum fails, or unreasonably delays, to carry out the work referred to in subsection (2), the licensing authority may cause any work not carried out to be executed at the expense of the said operator or person transporting or selling the petroleum.

Nothing contained in this section shall be construed as relieving the operator or person transporting petroleum from any liability in respect of any loss or damage caused by his failure to comply with safety measures as required in subsection (5).

A person transporting petroleum by road, rail, coastal or inland waters, pipeline or any other mode shall institute measures to ensure that their mode of transportation is safe.

The licensing authority may, at any time, require the operator of a facility or a transporter to show that he is in compliance with the provisions of this section.

It shall be the duty of every County Government to designate or provide a place or places exclusively reserved for parking of petroleum tankers.

A person who is in charge of or in control of any petroleum tanker and parks it outside a designated parking area for petroleum tankers commits an offence and shall on conviction, be liable to a fine not exceeding one hundred thousand shillings or to a term of imprisonment of six months or to both..

The owner or master of any ship carrying cargo, any part of which consists of petroleum, who fails to give notice to the port authorities upon entering a port, shall, on conviction, be liable to a fine of not less than ten million shillings, or to a term of imprisonment of not less than two years, or to both.

The owner or master of any ship carrying cargo, any part of which consists of petroleum shall comply with any law relating to the transportation of petroleum.

The government or a relevant agency shall as is reasonably practicable restore the environment to its former condition and such costs shall be recoverable from the owner or master of ship.

The Cabinet Secretary shall establish the Consolidated Petroleum Fund to cater for strategic petroleum reserve.

For the avoidance of doubt, the fund shall be managed in accordance with the Public Finance Management Act (Cap. 412A).

The Cabinet Secretary may prescribe regulations for the management of the Fund.

Where a contractor or licensee intends to enter upon any land for the purposes of conducting petroleum operations, access to such lands shall be governed pursuant to the provisions of the Constitution and the relevant land laws.

The Cabinet Secretary shall prescribe the forms and procedures for seeking and granting of the consent.

No consent expressed in writing in accordance with subsection (1) shall be void by reason only of non-compliance with any statutory requirements as to registration.

Any person who objects to a proposal to develop petroleum infrastructure on his land shall raise his objection in accordance with the provisions of the relevant written laws.

In the case of acquisition of rights of way or way leaves, the person shall raise the objection in accordance with the provisions of the relevant written laws.

After petroleum infrastructure has been laid in accordance with this Act, the contractor or any person authorised by the contractor or licensee may, from time to time as it becomes necessary, enter the land on which the petroleum infrastructure is laid with such assistance as may be necessary, for the purpose of operating, inspecting or repairing the infrastructure, or removing such infrastructure in case where the infrastructure is no longer required.

Where petroleum infrastructure is removed, the surface of the land shall forthwith be restored to its former condition as far as possible by the contractor or licensee and in default thereof restoration may be carried out by the owner of the land, and the costs thereof shall be recoverable from the contractor or licensee.

For the purpose of the production and transportation of petroleum, a contractor or licensee may erect, fix, install or lay any oil or gas pipelines, other infrastructure or apparatus in, through, upon, under, over or across any public street, road, railway, tramway, river, canal, harbour or National Government property in the manner and on the conditions as provided in this Act and any other relevant law.

Subject to the provisions of this section, a contractor may break up any street within his area of operation, and may erect petroleum infrastructure along, under or over any such street, and may, from time to time, operate, repair, alter or remove any such infrastructure so erected, laid or constructed:

Provided that the person having the control of such street road, railway, tramway, river, canal, harbour or National Government property shall have a prior right to break up and repair such street with reasonable dispatch upon payment to him of a reasonable charge by the contractor or licensee.

A contractor or licensee shall, not less than thirty days before exercising any power conferred upon him by this section, give notice in writing to the person concerned of the intention to do so, except in a case of emergency and in such case the contractor shall notify the person concerned as soon as possible after the emergency has arisen.

The powers conferred upon a contractor or licensee by this section shall, except in a case of emergency, be exercised only under the superintendence of the person concerned and according to a plan showing the location or route and in terms of specifications approved by the person concerned, or, if any dispute arises in respect of such plan, route or specifications, as may be approved by the licensing authority:

Provided that if the said person concerned fails to exercise the powers of superintendence conferred by this section the contractor or licensee may, after giving notice, exercise those powers without such superintendence.

Whenever a contractor or licensee carries out any work authorized by this section, he shall comply with the legislation, if any, of the county government concerned and shall complete that work with reasonable dispatch and reinstate the street broken up and remove any debris or rubbish occasioned thereby and shall, while the street is broken up or obstructed, cause the works to be, at all times, fenced and guarded and during the night, adequately lit.

If the contractor or licensee fails or unreasonably delays in carrying out the work referred to in subsection (5), the county government concerned may cause the work to be executed at the expense of the said contract.

A contractor or licensee shall pay to the said county government the costs reasonably and necessarily incurred by it in executing such work.

Nothing in this section shall be construed as relieving a contractor or licensee of any liability in respect of any loss or damage caused by his negligence in carrying out such work or by his failure to comply with the provisions of this section.

The compensation for the compulsory acquisition of land or rights in land shall be determined in accordance with the provisions of the Constitution and the relevant land laws and any other relevant law.

Whenever, in the course of carrying out petroleum operations, any disturbance of the rights of the owner or occupier of private land, or damage to the land, or to any crops, trees, buildings, stock or works therein or thereon is caused, the contractor or licensee shall be liable on demand to pay to the owner or occupier such compensation as is fair and reasonable having regard to the extent of the disturbance or damage and to the interest of the owner or occupier in the land.

If the contractor or licensee fails to pay compensation when demanded under subsection (3), or if the owner or occupier is dissatisfied with the amount of compensation offered to him, the owner or occupier may, within six months of the date on which the demand or offer is made, take proceedings before a court of competent jurisdiction for the determination and recovery of compensation, if any, properly payable under subsection (3).

All disputes between parties to a petroleum agreement arising from upstream petroleum operations shall be resolved through alternative dispute resolution mechanisms in the first instance as may be provided for in by the petroleum agreement.

Any other disputes arising from an upstream regulated function under this Act shall be referred to the Authority for determination in the first instance.

Any person who is dissatisfied with the decision of the Authority under subsection (2) may appeal to the Tribunal.

Despite the provisions of subsections (1) and (2), the Tribunal shall have original civil jurisdiction on any dispute arising out of the bidding rounds carried out under this Act.

The Tribunal shall have original civil jurisdiction on any dispute between a licensee and a third party or between licensees in midstream and downstream petroleum operations.

The Tribunal shall have appellate jurisdiction over the decisions of the Authority and any licensing authority in midstream and downstream petroleum operations and in exercise of its functions may refer any matter back to the Authority or any licensing authority for re-consideration.

In accordance with this Act, the Cabinet Secretary shall develop a framework for reporting, transparency and accountability in the upstream petroleum sector, which includes the publication of all petroleum agreements, records, annual accounts and reports of revenues, fees, taxes, royalties and other charges, as well as, any other relevant data and information that support payments made by the contractor and payments received by the national government, county governments and local communities.

Any vessel used to convey the vandalised equipment or appliance in the attempted vandalism detailed in subsection (1) shall be forfeited to the state.

Civil recovery may also be instituted in a court of competent jurisdiction to make good the loss suffered.

The Cabinet Secretary may, on the recommendation of the Authority and subject to sections 11 and 127, make regulations for or with respect to any matter that by this Act is required or permitted to be prescribed, or that is necessary or expedient to be prescribed for carrying out or giving effect to this Act.

The regulations to be made under this Act may be formulated by the Authority on its own motion or may be proposed to the Authority by any contractor, Operator person.

Before making recommendation of any regulations to the Cabinet Secretary under this Act, the Authority shall publish the proposed regulations for purposes of inviting proposals from the public, in such manner as it may deem fit, at least thirty days before the regulations are submitted to the Cabinet Secretary.

The regulations made by the Cabinet Secretary in accordance with this section may, impose conditions, requiring acts or things to be performed or done to the satisfaction of the Authority, prohibiting acts or things from being performed or done and may prescribe periods or dates upon, within or before which such acts or things shall be performed or done or within which such conditions shall be fulfilled.

The regulations made under this Act may be made for a limited period or without limit of period, and may be made subject to such conditions as the Cabinet Secretary deems fit, and may contain such supplemental and consequential provisions as the Cabinet Secretary considers necessary for giving full effect to this Act.