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Quantum ready to start construction of geothermal project in Menengai in 2018

GDC MD &CEO Eng. Johnson P. Ole Nchoe congratulates Quantum Power E.A Limited Director Mr. David Caroll on LoS for Menegai project, Oct. 11, 2017 (source: GDC)
Alexander Richter 24 Oct 2017

Quantum Power is the first of three IPPs to receive letter of support for the development of a 35 MW geothermal power plant at Menengai, Kenya.

As reported two weeks ago, Quantam Power East Africa Limited is the first of the three Independent Power Producers (IPPs) to receive a Letter of Support from the Government for construction of a 35MW power plant at the Menengai Geothermal Project.

The Letter of Support is one of the key conditions precedent for the project and will unlock the path for Quantam Power East Africa to reach financial close. Once this is done, the firm is set to start construction of a 35MW power plant in Menengai in February 2018.

Further, the Government has invited tenders for banks to provide Letters of Credit under a partial risk guarantee instrument provided by the African Development Fund (AfDB). The commercial bank to be selected is expected to issue Letters of Credit to the three companies; Quantam Power East Africa Limited, OrPower22 and Sosian Menengai.

The guarantee will shield the IPPs from risks such as lack of market for the generated electricity as well as political threats. The companies have already signed Project Implementation and Steam Supply Agreements with GDC as well as a Power Purchase Agreement (PPA) with Kenya Power for 105MW of power from the Menengai Geothermal Project.

Source: GDC