Kenya to import LNG, coal to generate electricity

Saturday November 9 2013

By KENNEDY SENELWA Special Correspondent

Kenya will import liquefied natural gas and coal to generate 1,800 Megawatts of electricity in Mombasa County, which will be injected into the national grid.

The Ministry of Energy expects to import liquefied natural gas (LNG) from Qatar and coal from South Africa and Zimbabwe.

The imported LNG, to be used in the Dogo Kundu power plant, which has a capacity of 700 to 800 Megawatts, will also be used as substitute fuel for some of the existing and planned thermal generation facilities in Mombasa County.

In October, the Kenyan government opened bids from private investors interested in building the LNG facility and coal fired power plant generating about 900 to 1,000MW respectively in Mombasa County and Lamu County.

Energy Cabinet Secretary Davis Chirchir said the Ministry is talking to the Qatari government and private firms based in the country to supply LNG to the power plant to be built at Dongo Kundu. 

“Kenya is talking to suppliers from South Africa and Zimbabwe to supply coal to the Lamu power plant. The government wants to reduce the industrial cost of power to $0.09 per kilowatt hour from the current $0.15,” he said.

The Ministry of Energy received expression of interest from 36 companies for the Dogo Kundu LNG facility and 26 for the Lamu plant. Bidders were required to show ability to raise at least $1 billion at competitive terms and have strong balance sheets with a minimum of $200 million.

Successful investors will build, own and operate the plants, with an option to transfer to the government after recovering full value of investment. The two plants are part of Kenya’s ambitious plan of generating 5,500MW for injection to the national grid within the next three years.

Kenya’s interconnected power system currently has a capacity of 1,664MW comprising of hydro (770MW); geothermal (241MW); thermal (622MW); co-generation (26MW) and wind (5MW).

The recorded peak electricity demand is suppressed at 1,357MW while the unsuppressed demand is estimated at 1,700MW, depicting a shortfall of 536MW after providing for a 30 per cent reserve margin.      

The successful bidder for Dogo Kundu plant will be required to build a floating storage and re-gasification unit with sufficient capacity and   infrastructure to supply natural gas to power plants using heavy fuel oil.