Kenya Electricity Generating Company (KenGen) PLC has signed a US$6,5 million contract to drill three geothermal wells in Djibouti. The deal was signed between KenGen and Djiboutien De Développement De lenergie Géothermique (Djiboutian Office of Geothermal Energy Development). The contract will see East Africa’s leading electricity generation company exporting its expertise in the field.
This is KenGen’s third geothermal drilling contract in Africa outside of Kenya
The signing ceremony took place in Galla Le Koma, Djibouti last week. Kenya’s Energy Secretary, Charles Keter, and KenGen Managing Director & CEO, Mrs. Rebecca Miano were in attendance.
Kenya’s deal with Djibouti will see the Horn country benefit from experience and expertise from the State-owned power generator which has so far drilled more than 300 wells within the Olkaria field.
Kenya has a geothermal energy potential of 10,000MW but just under 1000MW has been successfully exploited.
Kenya’s Energy Secretary, Charles Keter, pointed out that African nations shared the common aspiration of delivering electricity to their people, which, he said, provided an opportunity to work together to meet the continent’s energy needs.
“The biggest challenge has remained access (to electricity) in remote areas, and in Sub-Saharan Africa with 573 million people not having access to this important commodity. Although energy access policies have continued to bear fruit, with 2019 data showing tremendous progress, we have seen the Coronavirus pandemic reverse the gains. We can only remain optimistic that things will change in 2021,” the CS said.
KenGen’s regional expansion strategy
The Kenyan state owned utility KenGen hopes to offer more commercial drilling services, geothermal consulting and other energy-related services across Africa.
According to CEO Rebecca Miano, KenGen’s diversification strategy of leveraging its expertise in the field will record a major success when the three wells become productive and enhance Djibouti’s efforts towards growing its energy production.
“It is therefore our desire that in the next couple of years, we shall have considerable presence in countries within the continent. It is also worth noting that we are not only keen on increasing our presence in Africa, but also enhancing energy capacities across the region,” Ms Miano said.
This is the third geothermal drilling contract that KenGen has won in Africa. In October 2019, the company secured a Ksh 5.8 billion contract to drill 12 geothermal wells in Ethiopia. The contract with an independent power producer includes installing a water supply system and equipment.
In February 2019, KenGen won yet another contract for consultancy services and drilling geothermal wells. The contract is worth USD 76,801,344 (about Kshs 7.6 billion). It has also developed partnerships with countries such as Ethiopia and Rwanda in renewable energy development.
KenGen has invested in experts with considerable experience in geothermal exploration and drilling and will build the capacities of teams from Djibouti who will be working on the project.
Kenya is Africa’s number one geothermal energy producer and among the top 10 in the world. KenGen has a geothermal installed capacity of 706 MW and is the leading geothermal power producer on the continent.
In 2019, Kenya’s power installed capacity was 2,818.9 MW. Currently, the country’s energy mix comprises geothermal (29%), hydro (29%), wind (12%), solar and others (2%) and thermal (28%).