- Globeleq has signed financing agreements with the African Development Bank (AfDB) (as mandated lead arranger), the Eastern and Southern African Trade & Development Bank (TDB) and Finnfund, with regard to the US$72 million debt funding for the 35MW Menengai geothermal project in Nakuru County, Kenya.
Globeleq, which is owned 70% by British International Investment and 30% by Norfund, is providing equity, project development and construction management experience. The announcement follows the recent joint commitment by the Kenyan and UK Governments at COP27 in Egypt to fast-track green investment projects worth KES500 billion in the country, including the Menengai project.
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 after Olkaria. Construction of the project is expected to commence during the first quarter of 2023 once financial close has been reached. Globeleq will operate and maintain the power plant once it has reached commercial operations in 2025.
Steam will be supplied to the project by Geothermal Development Company (GDC), a Kenya government-owned company under a 25-year project implementation and steam supply agreement. Once operational, electricity will be sold to Kenya Power, the national distribution company, under a power purchase agreement for the same timeframe. The project also benefits from a signed and effective Letter of Support issued by the Government of Kenya. The project will deliver clean and cheap baseload power to the national grid and enable GDC to monetise the available steam resources from the Menengai steam field.
Author: Bryan Groenendaal
