Kenya House @ The Olympics

Kenyans are known for their athletic prowess, especially in winning medals at the Olympics. This year, The Government of Kenya is leveraging on this by having a Kenya House near the Olympics Park. Where guests can interact with Kenyan sportsmen and officials, while finding out more about Kenya.

The House is being used to promote Kenya's investment and trade opportunities. These include her main exports of tea, coffee, horticulture and tourism. This time not to be left behind Infrastructure projects are also being showcased such as the LAPSSET Projects (Lamu Port etc), Energy Projects and Konza ICT city to mention but a few.

For those who cannot go to West Ham Lane, Stratford, London between the 27th July and 12th August, you can catch the action in the House online via http://www.kenyahouse.or.ke/ , Where you can attend sessions virtually via various streams, contribute, debate and ask questions.

Companies in the oil & gas exploration scene is East Africa

East Africa is the latest oil & gas frontier and this fact cannot be underestimated. I have done some quick research on the companies currently in the Exploration and Production (E&P) scene in the region and these is what I found (see list below). The list may not be conclusive because the situation is so fluid with Farm in/Farm out contracts, mergers & acquisitions continuously happening as I scribble.

The companies come from all over the world ranging from the large integrated multinational oil companies such as ENI and Total, to specialist exploration companies such as Tullow, Africa Oil and Anadarko to mere speculators (mostly local) who acquire exploration block licenses just to sell out to companies with capacity i.e. money and expertise to explore, albeit at a profit.  

Companies I have definitely left out are the oil and gas services companies such as Schlumberger, Weatherford, Baker Hughes, Halliburton, Sakson, P.N.Mariot, GID, CPTD(China), Great Wall (China) who I believe are the main companies offering various services that enable drilling to happen. These companies operate below the surface and are sub-contractors of the companies listed below.

If you require more detailed research on these companies and their activities please contact the blogger?

Company	Origin	Country of operation
Beach Petroleum	Australia	Tanzania
Pancontinental Oil and Gas and its partner  First Australian Resources (FAR) Ltd	Australia	Kenya
Petrobras	Brazil	Kenya Tanzania & Mozambique
Africa Oil	Canada	Kenya, Ethiopia & Somalia
Leopardus Resources Limited	Canada	Mozambique
Orca Exploration Group	Canada	Tanzania
Pacific Seaboard Investments	Canada	Kenya
Rift Energy Corp.	Canada	Kenya
China National Offshore Oil Corporation (CNOOC),	China	Uganda
Total	France	Kenya, Tanzania & Uganda
ENI	Italy	Kenya, Tanzania & Mozambique
Japan Oil, Gas and Metals National Corporation (JOGMEC)	Japan	Japan
Mitsui & Co Europe PLC	Japan	Mozambique
National Oil Corporation of Kenya (NOCK) and	Kenya	Kenya
Petronas	Malaysia	Mozambique
Statoil	Norway	Kenya,  Tanzania & Mozambique
Sasol Petroleum International,	South Africa	Mozambique
BG Gas	UK	Tanzania
Cove Energy	UK	Mozambique & Kenya
Dominion Petroleum	UK	Kenya, Tanzania & Uganda
Heritage oil	UK	Tanzania & DR Congo
Madagascar Oil	UK	Madagascar
Ophir Energy	UK	Tanzania & Kenya
Origin Oil	UK	Kenya
Premier Oil	UK	Kenya
Tullow oil	UK & Ireland	Kenya, Ethiopia & Uganda
Anadarko Corporation	USA	Kenya, Mozambique & Tanzania
Apache Petroleum Corp	USA	Kenya
Enron Oil and Gas Resources Inc	USA	Mozambique
ERHC Energy	USA	Kenya
CAMAC Energy Inc	USA, Texas	Kenya
Marathon Oil	USA, Texas	Kenya

New Olkaria Geothermal plant in Kenya launched

Yesterday the President of Kenya, H.E. Mwai Kibaki launched the construction of a 280MW geothermal project at Olkaria, 100Kms from the capital Nairobi.  The new plant will cost approx. USD 1Billion and will be the largest geothermal power plant in Africa when completed in 2014. It will cumulatively increase Kenya’s electricity capacity by 40% from the current 1500MW, considering other projects already under development. 

This is good for the country because its current shortfall at peak demand is currently 200MW. Electricity supply is also known to be erratic and expensive compared to other countries in the region.

The project is funded by Kengen, Kenya’s national power producer, The Government of Kenya, the Japanese International Cooperation Agency( JICA), The World Bank, German Development Bank , (KFW), The French Development bank( AFD), and The European Investment bank.

The project is being undertaken by a consortium made up of Japan’s Toyota Tsusho Corp and South Korea’s Hyundai Engineering & Construction building the main power plant. Sinopec of China is developing the steam field while construction of the substation and transmission lines is being done by India’s KEC. We see a predominantly Asian team participating in this project.

The project is part of the government’s Vision 2030 plan to increase the country’s power production to 3,750MW by 2018 and 15,000MW by 2030.

In the speeches yesterday most officials talked about cheaper renewable energy through geothermal energy and this plant and others to follow going a long way in creating a capacity reserve. A capacity reserve that will prevent blackouts and power shedding during peak demand. Kenya currently has an estimated proven reserve of 7,000MW of Geothermal Power.

From my analysis I predict that when plant is complete it won’t have made a difference to the reserve capacity as it would have only gone to quench the current and growing power deficit. With the ongoing rapid rural electrification program, growing population and expanding foreign investment in business, manufacturing and commerce, the growth in demand should be about 10% per year. Even more I don’t believe the power will be cheaper, immediately, as the loans taken from the international lenders mentioned above have to be paid back with interest over period of time. My prediction is that power from this plant will be cost effective and cheaper  after around 10 years.

Currently only 15% of homes in Kenya have domestic power from the national grid, while industries go without power for an average of 6 hours a week or more( According to Ms Betty Maina, the Chairlady of the Kenya Association of Manufacturers). But all in all congratulations to the Kenyan government for successfully pushing through such a large and strategic project to increase provision of power that many Kenyans have been yearning for and that will make Kenya’s electricity more stable and cheaper in the long run.

Kenyan Cement Factory requests Expression of Interest in Renewable Energy Projects

The East African Portland Cement requests for expressions of interest for waste heat recovery and power generation projects equipment supplier. Click on the link below for details.

http://www.eastafricanportland.com/userfiles/9201434R.pdf

This is to enable the company improve its energy efficiency through demand side energy management, by reusing the heat it expunges (Waste Heat Recovery(WHR)) while making cement.

Its also looking at exploring other options to meet the shortfall in energy it might get through WHR via a coal plant, solar, gasification plant etc.

This is the ideal way to go for the more than 6 cement factories in region, and the ones planned for development. Demand Side Energy Management has been around for a while and its good to see a Kenyan company taking action.

Construction of a 1,000Km power line between Ethiopia and Kenya to commence soon.

The World Bank has approved funding for a 1,000km high voltage transmission power line between Ethiopia and Kenya. According to Reuters the power line is part of a bigger US$1.3 billion funding programme that will create a power pool linking countries within East Africa and transmit 300MW of power from Ethiopia to Kenya.

Ethiopia has surplus power due to its abundance of hydroelectric generation capacity. Though according to studies, 80% of its population remains without domestic electricity.

Kenya is set to gain from a more sustainable electricity source, considering its 1,300MW capacity fluctuates due to the effects of climate change as its rivers dry during recurrent droughts. Kenya’s hydro power generation is slightly above 50% at maximum capacity and declines significantly during droughts necessitating the uptake of power from thermal plants that use diesel and fuel oil. Which are both expensive and environmentally unfriendly.

Other than transmitting power, the transmission line is to form part of the East Africa Power Pool connecting the countries of Kenya , Uganda, Tanzania, Ethiopia, South Sudan and Rwanda. This will increase power trading between these countries enabling countries with surplus to sell to those in deficit, reducing occurrences of black outs and power shading.

The power line is also set to pass through the Marsabit region of northern Kenya, which has one of the highest wind speeds in the region. This will enable the three planned wind power projects in that area to commence. As the main hindrance to these projects taking off was a lack of access to the national grid. This should further boost Kenya’s renewable energy generating capacity in the medium term.

The people of northern and north eastern Kenya, historically marginalized, and who mostly do not have access to domestic electricity are likely to be connected to the grid as the electricity will most likely be supplied to them first as a priority.

However, my thoughts are that though the Kenyan grid will become more stable with more consistency in electricity supply, the cost of power isn’t likely to go down in the medium term. This is because these projects and others associated to it will have to be financed by borrowed international funds which have to be repaid through a surcharge on power bills, before cheap power can be available to Kenyans. Therefore, the wait for cheaper electricity should take a bit longer.

As for Ethiopia, this project will mean stronger political and economic ties to its southern friendly neighbor, Kenya, as it continues to posture with its hostile neighbors to the north and north east.