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Sh153bn debt forces Turkana wind power line builder into bankruptcy

Cabinet secretary Charles Keter. FILE PHOTO | NMG
Cabinet secretary Charles Keter. FILE PHOTO | NMG 

Spanish infrastructure group Isolux Corsán, the contractor building the Lake Turkana Wind power transmission line, has filed for bankruptcy over a Sh153.6 billion debt throwing into doubt timely completion of the project.

The largest wind farm in sub-Saharan Africa meant to add 300-megawatt of reliable, low cost wind energy to the national grid should have been launched in June were it not for a lack of transmission lines.

State-run Kenya Transmission Company (Ketraco) said the line had been 60 per cent completed by last March. Isolux was initially expected to complete the power line by the end of 2013.

The total cost of the Loiyangalani-Suswa power line was put at €142 million (Sh15.7 billion).

In March, Energy Cabinet secretary Charles Keter gave a June deadline for the completion of the line, saying the government had moved in to pay subcontractors and suppliers owed by the Madrid-based Isolux, which bagged the tender for the 428-kilometre high-voltage line in 2011.

On Wednesday, however, contractors who spoke on condition of anonymity said Ketraco had not honoured the agreement putting in limbo works on the project.

“The premises for this agreement was to facilitate the cash-flows for the sub-contractors and the way-leaves would be cleared,” said one of the sub-contractors.

“Unfortunately enough, Ketraco refuses to honour the agreement which has now been running for five months. And this leaves subcontractors very exposed and in default to their suppliers.”

Mr Keter and the Ketraco did not respond to our queries on the matter.