London-based power company Globeleq has awarded an engineering, procurement and construction (EPC) contract and a long-term service agreement (LTSA) to Toyota Tsusho Corporation (TTC) for its 35-megawatt (MW) Menengai geothermal project in Nakuru County, Kenya.
The signing of the agreements is a major milestone for the project after financing agreements were signed in December 2022 with the African Development Bank, the Eastern and Southern African Trade & Development Bank and Finnfund, Globeleq said in a statement.
During COP27, President Ruto of Kenya and Prime Minister Sunak of the UK jointly committed to fast-track green investment projects worth 500 billion Kenyan shillings in the country, which included the Menengai project.
Construction of the project is expected to commence during the first quarter of 2023 once a financial close has been reached.
Globeleq will operate and maintain the power plant once it reaches commercial operations in 2025. The steam turbine and generator will be manufactured by Fuji Electric.
The $108 million Menengai is a greenfield geothermal project and part of the first phase of the wider Menengai complex, which is the second large-scale geothermal field being developed in Kenya.
Steam will be supplied to the project by the state-owned Geothermal Development Company under a 25-year project implementation and steam supply agreement, the statement added.
Once operational, electricity will be sold to Kenya Power, a national distribution company, under a power purchase agreement for the same timeframe.
(Writing by P Deol; Editing by Anoop Menon)