In a clearing on Kenya's coastal grasslands, a group of nomadic herders shout down government officials who have flown in from Nairobi to explain the benefits of a proposed $350 million sugar project.

"If the delta is planted with sugar, we will run out of grazing land for our cattle," local community leader Bile Bundit says. Others wave placards at the flustered officials sitting in a makeshift tent made from wooden poles and sack-cloth.

Hoping to plug Kenya's annual 200,000-tonne sugar deficit and make biofuel, the government, together with the nation's largest miller Mumias, plans to plant cane on 20,000 hectares of the vast Tana River Delta on the Indian Ocean coast.

The plan has aroused enormous controversy in east Africa's largest economy, pitting ancient traditions against development, environment against industry, and traditional nomads against large-scale farming.

Supporters say the project will create 20,000 direct and indirect jobs, reduce the import bill and put biofuel-powered cars on Kenyan roads.

Critics say it will crush local ways of life and harm one of Kenya's most pristine and bio-diverse wetlands. The project would transform the riverine vegetation of the delta - grass, forests and mango trees - into vast fields of sugar cane.

"We cannot just start messing around with the wetland because we need biofuel and sugar," Kenyan Nobel laureate and environmentalist Wangari Maathai said.

Earlier this month, Kenya's High Court ordered a temporary halt to the project pending a judicial review of its impact. But the government is determined to overcome that hurdle.

Mumias, a Nairobi bourse blue-chip company that has a controlling stake in the project, plans to install an 8,000 tonnes-per-day sugar mill and distil 23 million liters of ethanol per year from molasses, a cane by-product.

The firm says the ethanol will be used to make biofuel, seen by many as the world's way out of fossil fuels dependency.

It would also produce 34 megawatts of electricity per day from cane by-products - another strong argument for those in favor, given Kenya's growing energy demands.

SPECIES THREATENED?

"The project will pretty much catapult the area into the era of modern society," says Mumias CEO Evans Kidero, adding sugar production costs would fall 75 percent at the Delta, helping bring down prices across the country.

In the west, Kenya's only current sugar-growing area, it costs $570 to produce a tonne of sugar, compared to between $240-290 in Sudan and Egypt, according to the Southern and Eastern Africa Trade Information and Negotiations Institute.

Experts say dumping of cheap imports, poor infrastructure and technology shortcomings have held back Kenya's industry.

A twenty-minute drive up the coast from the hostile pastoralists, members of another local community, the Pokomo, who are mainly crop farmers, give the officials an enthusiastic welcome on the next stop of their roadshow.

Entertainment includes songs imploring the government to hurry up with the sugar project.

"There are a few people protesting, but the majority want the project," says delegation leader and Regional Development Minister Fred Gumo, vowing nothing will stop the project.

Project backers say it will help drag a backward region into line with the rest of the country.

The Tana River Delta area has a 42 percent poverty rate, one of the highest in the country, a 2006 government survey shows.

It also has a high rate of illiteracy with 85 percent of the local Wardei people having no education at all, 21 percent among the Pokomo and 36 percent among the Orma.

Conservationists, including foreign groups like Britain's Royal Society for the Protection of Birds, have warned the sugar project will threaten 350 species including birds, sharks and reptiles.

"Irrigation will interfere with the natural flow of water in the delta and it will affect fish breeding sites," says Maulidi Diwayu, a local resident.

Backers of the project say they are ready to make amends for any disturbance of the environment.

"We found it will impact the environment negatively and positively, but on balance, the project was found to be environmentally, socially and economically feasible," says Professor David Mungai who led a project impact study.

Kidero says resistance stems from fear of the unknown which will disappear when project benefits become apparent. "Life is changing. You either change or life will change you," he says.