Chinese firm offers to waive Sh1 billion claim on Ketraco bill


High voltage power transmission lines. FILE PHOTO | NMG

A Chinese firm that completed the construction of the Loiyangalani-Suswa power transmission line has offered to waive a Sh1.1 billion interest claim against the Kenya Electricity Transmission Company (Ketraco) in a bid to unlock payment of Sh1.138 billion due from the State.

Nari and PowerChina Guizhou Engineering (Nari-PCGE), which completed the line that is being used to evacuate electricity from Lake Turkana Wind Power (LTWP) project, told Parliament that it is willing to waive the interest that has accrued over four years if this will prompt the Treasury to make good the principal dues.

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Ketraco paid Nari-PCGE Sh11.64 billion ($99.71 million) leaving a balance of Sh1.138 billion ($9.74 million) after the Chinese firm completed the line in 2018. The firm was tapped in 2018 to complete the 428-kilometre 400kV line after Spanish contractor Isolux, which had been contracted for the job, went bankrupt.

“The consortium of Nari and Powerchina Guizhou Engineering was willing to negotiate and discount on the interest component if the government of Kenya is to pay the principal amount, which has been due for four years,” the Public Investments Committee says in its inquiry into of the LTWP project.

The offer comes just months after the Treasury received Sh785 million the Standard Chartered Bank in Frankfurt, Germany had rejected as a refund for excess pay from Kenya Power to LTWP.

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The Mvita MP Abdulswamad Nassir-chaired committee said part of the money refunded by the Lake Turkana Wind Power in March should now be used to offset the debt owed to Nari-PCGE and save taxpayers additional penalties.

“The National Treasury should urgently avail (sic) funds for settlement of claims due to the Consortium of NARI Group Corporation and PowerChina Guizhou Engineering, part of the funds should be drawn from the 6.17 million euros refunded by LTWP to the government of Kenya in March 2022,” the committee said.

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