KenGen bags new Sh5.2bn geothermal tender in Ethiopia


A KenGen geothermal energy plant in Olkaria, Naivasha. FILE PHOTO | NMG

Kenya Electricity Generating Company (KenGen) #ticker:KEGN has won a Sh5.2 billion tender to drill geothermal wells in Ethiopia, marking the second win in the landlocked country in under four months.

Business development director at KenGen Moses Wekesa said it has reached an agreement with an independent power producer (IPP), Tulu Moye Geothermal Operations Plc, located in the eastern region of Ethiopia, to drill wells and offer geo-scientific survey.

“We bid and the first bidder fell off. We were the second best evaluated bidder. The IPP has now engaged us in discussion. We have negotiated and settled,” said engineer Wekesa during the recent energy debate convened by QLand Energy Communications Consultancy.

“We will be providing geo-scientific survey and drilling eight geothermal wells. One geothermal well costs about Sh650 million.”

This will be the second such tender for KenGen in the horn country after it announced February that it has won part of a Sh7.6 billion contract to supply geothermal drilling services to the Ethiopian Electric Power (EEP).

KenGen said it would be supplying about 30 percent of the component of phase II which translates to about $ 6.2 million (Sh620 million). Mr Wekesa said the latest win will deepen KenGen’s vision to diversify revenue streams, riding on experience in the energy space. “We have over the period developed a very solid experience in human capital especially in geothermal and we have been seeking opportunities to export our expertise,” said Mr Wekesa.

It is now eying Rwanda and Djibouti for geothermal project, having hosted Djibouti President Ismail Omar Guelleh at the Olkaria geothermal fields in Naivasha last year.