Lamu coal power project to move forward

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Lamu coal power project to move forward

The 960 MW Lamu coal power project in Lamu County, Kenya, has received green light to move forward after an appeal against the tender award was rejected.

The tender award raised controversy prompting HCIG Energy Investment to appeal against the Ministry of Energy's decision, citing irregularities.

Finally the chairman of the Public Private Partnership Committee, Kihara Muruthi, has announced that the appeal was rejected and HCIG Energy Investment will have to pay the cost of the petition.

The tender was floated in September 2013 when the ministry invited expressions of interest but it was not until January that the deal was put under the PPP. The project was awarded in early September 2014 to a consortium composed by:

  • Centum Investment Company Limited,
  • Sichuan Electric Power Design and Consulting Company Limited (SEDC),
  • Sichuan No. 3 Power Construction Company (SEPCC), and
  • China Huadian Corporation Power Operation Company (CHD)

The consortium emerged as the winner from a list of 26 bidders which included large multinational players from; India, Japan, the USA and Europe.

The project will cost approximately US$2 billion, of which approximately US$500 million will be funded by equity and the balance of approximately US$1.5 billion will be funded through debt.

It is expected that the winning bidder will sign a Power Purchase Agreement (PPA) for a 25-year period.

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