KenGen is conducting exploration surveys in Eswatini to establish the country’s geothermal energy potential, underlining the firm’s growing status as the go-to company in unlocking the potential of Africa’s steam power.
The Eswatini deal, whose value remains undisclosed, adds to contracts that KenGen has bagged to drill three geothermal exploration wells in Tanzania’s Ngozi area.
KenGen is also in Ethiopia and Djibouti while Malawi and Zambia have approached it for similar tests to ascertain the viability of their geothermal potential.
The Eswatini and Tanzania deals will further grow the Sh14 billion worth of contracts that KenGen has won since 2019 to offer consultancy and drill wells in Ethiopia and Djibouti. The deals are key to KenGen’s revenue diversification push.
“We are currently in Eswatini where we are doing exploration to confirm if they have the potential for geothermal and all indications so far are that they have the potential. The next stage will be to see if we can go to production wells,” KenGen MD Mr Peter Njenga said on Tuesday.
Authorities in Eswatini recently picked Mvutshini, Mkhoba, and the Lubombo Plateau around Magadzavane as the areas with the potential to generate geothermal energy. Mr Njenga did not however disclose the number of wells that KenGen is surveying in Eswatini (formerly Swaziland).
Exploration drilling will follow if the surveys by KenGen establish that the areas have enough geothermal steam to generate power.
“Zambia has also come to us, maybe after Eswatini we will just cross over to Zambia and do exploration there and many other countries that trust in KenGen’s ability and skills to help them harness geothermal,” Mr Njenga added.
KenGen made a net profit of Sh6.79 billion in the year that ended June, and the firm is keen to further diversify its revenue basket in a bid to remain on this trajectory.
The State-owned power producer is banking on its success in tapping Kenya’s geothermal power which has seen Kenya ranked number seven globally in producing electricity from geothermal sources.
Kenya is leading in Africa in geothermal energy production, with an installed capacity of 940 Megawatts (MW). KenGen accounts for 85 percent of this or 799 MW.
Geothermal accounts for 43 percent of the electricity mix in the national grid, ahead of hydro at 30.5 percent, with the dominance largely attributed to KenGen’s plants in the Olkaria region.
KenGen’s deals to drill wells and offer consultancy services in Ethiopia are worth Sh13.4 billion, while those for Djibouti are valued at Sh709 million.
