Kenya Electricity Generating Company (KenGen) has won a US$52 million tenders to drill geothermal wells in Ethiopia, marking the second win in the landlocked country in under four months.
Business Development director, Moses Wekesa said KenGen has reached an agreement with an independent power producer (IPP), Tulu Moye Geothermal Operations Plc, located in the eastern region of Ethiopia, to drill wells as well as to offer geo-scientific survey.
“We were the second-best evaluated bidder but the first bidder fell off prompting the IPP to engaged us in discussion. We have negotiated and settled,” said engineer Wekesa
Mr. Wekesa was speaking at an energy debate convened recently by QLand Energy Communications Consultancy.
KenGen will drill eight geothermal wells at a cost of US$6.5 million for one and provide geo-scientific survey. This will be the second such tender for KenGen in Ethiopia.
In February, KenGen secured a deal with Ethiopian Electric Power (EEP) for rig operations, drilling, and maintenance of geothermal wells valued at US$76 million.
Mr. Wekesa said the latest win will deepen KenGen’s vision to diversify revenue streams, riding on experience in the energy space. “We have over the period developed a very solid experience in human capital especially in geothermal and we have been seeking opportunities to export our expertise,” said Mr Wekesa.
KenGen is now eying Rwanda and Djibouti for geothermal project, having hosted Djibouti President Ismail Omar Guelleh at the Olkaria geothermal fields last year.
This will reduce the requirement for generators in Ethiopia by booting the power grid. Kenyan companies supply a range of pumps and generators to Ethiopia, which are used across the country, while many more are imported through the ports like Eritrea.