28 November 2013, Nairobi – The Africa Geothermal International Kenya (AGIL) on Wednesday signed a Sh730 million (USD 8.4 million) grant with the African Union Commission (AUC) to facilitate the exploration of geothermal resource in Longonot.
Africa Geothermal international President and Chief Executive Officer Fassine Fofana said they were targeting to produce more than 140 megawatts of renewable electricity.
“The drilling is at a cost of Sh3.1 billion (USD36 Million) and this funding comes in handy,” he said.
Fofana said they have completed the environmental assessments and obtained the required permits to begin an exploratory drilling program for the presence of a commercially viable resource.
He said the full construction of the 140MW plant is at a cost of Sh52 billion and will employ up to 1,000 people.
“As a private sector project, Longonot will bring much needed investment into Kenya without burden on the taxpayers Geothermal power is among the lowest cost power available in Sub Saharan Africa and is cost effective without subsidies. It is estimated that during the construction phase, the Longonot geothermal project will employ up to 1,000 people,” he said.
He said the geothermal project is in line with the government’s commitment to produce 5,000 megawatts of geothermal power by 2018.
“As a renewable source of energy, drawn from a domestic source, the Longonot geothermal project will contribute significantly to Kenya energy pool and help reduce the average price charged to the Kenyan consumer. This will be achieved by displacing relatively more expensive fossil fuels-based power,” he said.
In July 2009, the Ministry of Energy awarded AGIL a Geothermal Resource License in Longonot, in the Rift Valley area of Kenya.
The license covers a concession area of 132km and allows AGIL to build a geothermal power plant and to use the geothermal resources within the Longonot concession area for a period of 30 years from the effective date of the Power Purchase Agreement (with option for a five year extension).
AGIL signed a Power Purchase Agreement (PPA) with Kenya Power and Lighting Company (KPLC) in April 2013. Under the PPA, AGIL will supply 140MW of base load geothermal power to Kenya Power by 2017.
– Capital FM