530-km Lapsset highway construction starts mid next year
Lapsset chair Francis Muthaura (second right) and Transport Cabinet Secretary James Macharia (centre) on signing a deal for construction of a road to open up the northern Kenya corridor, Nov 29, 2017. PHOTO | KANYIRI WAHITO | NMG
Government enters consortium deal to fund the project to a tune of Sh62 billion ($620 million) in initial capital investment
Project will take approximately four years to be complete and will be run by the consortium
Operations and maintenance phase will run for 25 years after the completion of the project.
Construction of the 530-kilometre Lamu-Garissa-Isiolo Highway, the first section of the Lapsset infrastructure project, is set to start mid next year.
Transport Secretary James Macharia said the government had entered a deal with a consortium to fund the project to a tune of Sh62 billion ($620 million) in initial capital investment.
He said the Kenya National Highways Authority (KeNHA), the project’s implementing agency, had entered into a commercial agreement with Lamu Road Consortium-- comprising Group Five Proprietary limited, a South African consortium and Development Bank of Southern Africa (DBSA) -- through a public-private partnership.
“KeNHA is signing an agreement with this consortium to basically kick off the commencement of early works of construction of the Lamu-Garissa-Isiolo road which is 530km and is part of the 2,000 km Lapsset corridor, slated to start by June next year,” Mr Macharia said during the signing of the agreement on Wednesday in Nairobi.
The Cabinet secretary said early works of the project had been delayed as a result of lack of financing.
He, however, said the government had opted to go ahead with the commercial agreement before finalising the financial agreement later on for the entire project.
“One of the issues in the project has been finance but because it is so key we could not wait until the financing is put in place or other elements of that consortium of projects so we are now starting the development of the key project and in the process we shall sign financial agreement for the entire project,” he said.
Mr Macharia said that the project will take approximately four years to be complete and will be run by the Lamu Road Consortium (LRC).
He said operations and maintenance phase would run for 25 years after the completion of the project.
“LRC will operate the road while maintaining high performance standards equivalent to a motorway to enhance throughout of transit vehicle and also reduce vehicle operating cost,” said the CS.
The Lamu Port-South Sudan-Ethiopia Transport (Lapsset) corridor – which is Eastern Africa’s largest and most ambitious infrastructure project with seven components – was launched in 2013 and has a budget of approximately Sh2 trillion.
The CS gave update of sections of the project, saying the 505km Isiolo-Moyale road has been completed while construction of Loichangamatak-Nadapal road was ongoing, just as the Garsen-Witu-Lamu road.
He added that design studies were ongoing for the Isiolo-Maralal link road, Isiolo-SukutaMugie-Nginyang’ road and Nginyang’-Lokori-Lokichar road.
“We are opening up the corridor completely to open hitherto undeveloped parts of northern Kenya to enhance the growth of the country as a result of investments in along the corridor.
"Just as we did with the Chinese in the SGR project where a certain percentage went to the locals, I believe this is the same spirit we are getting into with the company,” he said.
Group Five chief executive Thambo Mosai said the partnership was a show of confidence in Kenya and promised to involve local sub-contractors and labourers throughout the project.
“We will utilise Kenyan sub-contractors and labourers in the process just as big companies in South Africa do,” said Mr Mosai.
Lapsset chairman Francis Muthaura hailed the agreement, saying the highway was an important outlet that would make it possible to take cargo to the hinterland and even to neighbouring countries of South Sudan and Ethiopia.
He said about 10 towns in the corridor were going to benefit from investment and development brought about by the project which is anticipated to add about three per cent to Kenya’s annual GDP growth.
“The first berth of Lamu Port, of the 32 berths, will completed by June, 2018. Once the port is completed we will be able to carry the cargos received by sea to hinterland,” said Muthaura.
KeNHA director general Engineer Peter Mundinia said that part of the corridor from Isiolo, Marsabit to Moyale was already paved and ready for use by transporters.
“This will help because the cargo that congest the central part of the country will now go that way,” said Eng Mundinia.
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