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Nairobi, 18th August 2021: Kenya Electricity Generating Company PLC (KenGen) has surpassed a crucial stage in the ongoing USD 6.2 million geothermal drilling contract in Ethiopia further giving impetus to its corporate diversification strategy.

The team of KenGen engineers have so far crossed the 450 meters of drilling depth of the first of eight geothermal wells for the state-owned electricity producer, Ethiopia Electric Power Company which commenced in May this year amid COVID-19.

“The first 450 meters is the most difficult phase of the entire geothermal well drilling process which can go upto a depth of 3,000 meters,” said Managing Director and CEO, Rebecca Miano adding, “this particular one is being done under peculiar circumstances including unforeseen delays occasioned by the COVID-19 pandemic.”

“We will be drilling at a rate of about 50 meters per day going forward and therefore expect to complete the remaining part on schedule in about two months,” said Mrs. Miano.

In February 2019, KenGen won a joint contract with Shandong Kerui Petroleum Equipment Company and Shandong Kerui Oilfield Service Group to offer geothermal drilling services. The project is being managed between the two consortium members under the contract.

"We are glad that the progress of drilling at Aluto-Langano is remarkable, and optimistic our team will deliver it within the set timelines. We commend our team for surpassing the 450 metres depth of drilling, overcoming all the challenges usually encountered at the initial stages of drilling a geothermal well," said Miano. 

She added: "We have a team of experts comprised of aerated drillers, directional drillers, and reservoir engineers actively working on this project and have also dispatched a team to mobilize a second rig to fast track the process and achieve our goal of drilling eight wells much faster.”

The drilling of the second geothermal well under the Aluto-Langano project started early this week and was at a depth of 36 meters by Wednesday August 18, 2021.

KenGen is hopeful that under the ongoing project, which is financed by the World Bank through a loan to the Ethiopian Government, depending on the outcomes of Lot 1 wells, an additional 12 wells may be drilled under Lot 2 of the contact to bring the total to 20 wells.

At the same time, also in the Horn of Africa, under a contract signed in October 2019, KenGen has completed drilling two geothermal wells for Tulu Moye Geothermal Operations PLC (TMGO) in Ethiopia and is currently drilling the third well.

These two projects are hinged on the Company’s diversification strategy which has led to the organization’s expansion in the Horn of Africa. Besides Ethiopia, KenGen has also secured a Ksh.709 million project to offer commercial drilling services in Djibouti.

In February this year, the company signed the contract with Office Djiboutien De Development De lenergie Geothermique (Djiboutian Office of Geothermal Energy Development) (ODDEG). KenGen is also prospecting for similar businesses in Rwanda.

Kenya is Africa’s largest geothermal energy producer and among the top 10 in the world. The country has an estimated potential of 10,000MW along the Rift Valley.

Nairobi, 25th August, 2021: Kenya Electricity Generating Company PLC (KenGen) has received carbon credits from its Olkaria I, Units 4 and 5 Geothermal Power plant further solidifying the company’s lead in climate action in Africa.

This follows the issuance of an additional 2,040,515 Carbon Emission Reductions (CERs) for the Naivasha based project by the United Nations Framework Convention on Climate Change (UNFCCC).

This brings the amount of carbon credits issued to KenGen to date to 2,591,496 tonnes of Carbon Dioxide Equivalent (CO2e) valued at USD.3,887,244 which are now available for sale. The sale process of the carbon credits has been initiated as guided by the applicable disposal laws and regulations for the public sector organizations.

The 140MW Olkaria I Additional Units 4 and 5 power plant, will reduce CO2 emission through the displacement of electricity generated by fossil fuel fired power plants connected to the national grid.

Announcing the issuance of the CERs, KenGen Managing Director and CEO, Mrs. Rebecca Miano said the UNFCCC’s issuance of the carbon credits is an affirmation of KenGen’s commitment to address climate change which is one of the biggest global environmental challenges currently.

“KenGen has set up a dedicated team that is spearheading environmental sustainability to help combat climate change. So far, we have developed and registered six (6) Clean Development Mechanism (CDM) Projects comprising of Olkaria II Geothermal Expansion Project, Redevelopment of Tana Hydro Power Station Project, Optimisation of Kiambere Hydro Power Project, Olkaria IV Geothermal Project, Olkaria I Units 4 and 5 Geothermal Project and Ngong Wind.”

Mrs. Miano went on to say: “These projects together contribute to offsetting approximately 1.5 million tonnes of Carbon Dioxide (C02) equivalent annually.”

“The Olkaria IV Plant is currently undergoing a review process, which could see the issuance of an additional 2,025,813 CERs in the near future,” She added.

At the same time, KenGen which is listed on the Nairobi Securities Exchange (NSE), is poised to earn about Ksh.119 million from the 550,981 carbon credits that were issued as at July 2021.

The CDM projects contribute to national sustainable development by providing clean energy which ensures improved environmental quality, positive health impacts and increased productivity. CDM was developed as part of the output of a global concern to contribute to climate change mitigation and to foster sustainable development for non-industrialized countries.

KenGen has deliberately shifted its strategy to focus on the production of green energy and currently more than 86% of the energy produced by the Company is from clean sources namely wind, hydro and geothermal. 

Thanks to KenGen’s efforts, Kenya is today Africa’s largest geothermal energy producer and among the top 10 in the world. The country has an estimated potential of 10,000MW of geothermal along the Rift Valley.

As a way of enhancing its portfolio of climate change mitigation projects, the Company intends to incorporate additional geothermal, wind and solar projects which will further reduce carbon emissions annually, in the process reducing the impact of climate change on the environment.

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