Circle Gas, the UK parent of Kenyan pay-as-you-cook LPG supplier M-Gas, reported $67 million in contracted carbon credits awaiting delivery at the end of 2025, highlighting the company’s exposure to the timing of carbon-market approvals.

Table Of Content

Losses and funding needs
Approval process remains significant
Contrast with Koko Networks

The company’s financial statements also recorded $57 million in cash prepayments received against carbon-credit contracts. The accounts do not state how much of that money remains available or how much of the contracted portfolio depends on outstanding authorisation.

Losses and funding needs

Despite revenue increasing to $40.8 million in 2025 from $36.1 million in the previous reported period, Circle Gas remained loss-making. It recorded a loss after tax of $39.3 million for the year.

The company held $1.1 million in cash at the end of 2025, while its net liabilities rose to $156.7 million from $116.5 million. Circle Gas said it needed approximately $28 million in additional funding to support its 2026 growth plans.

Its financial statements warned that the funding had not been fully secured when the accounts were approved. “There is no certainty that funding will be available to the Group,” the statements said in reference to the additional third-party financing required for the company’s 2026 base case.

Approval process remains significant

Circle Gas’s annual report said the company had received a Letter of Acceptance confirming that its carbon-credit projects met the relevant eligibility criteria. The document allowed the projects to proceed with an application for a Letter of Authorisation.

Under Kenya’s carbon-market framework, approval of a project is distinct from authorisation to transfer specified emissions reductions internationally. Circle Gas said authorised credits could command significantly higher prices than credits sold in advance, although it did not disclose the expected premium.

M-Gas separately announced in January 2026 that its clean-cooking carbon project had received a Letter of Approval. The available information does not establish whether that document is the same as the Letter of Acceptance described in Circle Gas’s annual report.

Circle Gas’s authorisation request had not been rejected, but the company’s accounts do not disclose the proportion of its contracted credits affected by the remaining process. They also do not attribute the company’s losses and funding needs solely to the outstanding authorisation.

Contrast with Koko Networks

The financial disclosures come amid difficulties for another Kenyan clean-cooking company, Koko Networks. The firm sold subsidised bioethanol stoves and fuel to low-income households and relied partly on carbon-credit sales to cover operating costs.

Koko shut down in January 2026 and laid off more than 700 employees. Its Kenyan and UK entities entered administration the following month after the Kenyan government declined to authorise the carbon-credit sales on which its business depended.

Lee Kinyanjui, Kenya’s Trade Cabinet Secretary, said the volume of credits sought by Koko could have exhausted the country’s allocation for international transfers. Without a sale of Koko’s carbon-credit assets, the company owed $60 million to FirstRand Bank and about $171 million to other unsecured creditors.

The Koko case illustrates the financial consequences that can arise when anticipated carbon-credit revenue is not authorised. Circle Gas, however, remains at the stage of seeking additional financing while its clean-cooking projects proceed through the authorisation process.