The government has locked the tender for the upgrade of the Jomo Kenyatta International Airport (JKIA) to mega contractors with access to cash or a credit line of at least Sh100 billion to guarantee a speedy completion of the project.
The State Department for Aviation and Aerospace Development on Tuesday invited bids for the design and building contract for JKIA, locking out small-time contractors to guarantee the timely completion of the project.
The State specified that mega contractors with access to high amounts of cash and a track record of handling similar projects in the region will be allowed to bid for the tender.
“The tenderer shall demonstrate experience in delivery of at least one construction project including testing and commissioning, in East Africa, with a value of at least Sh100 billion,” said the State department in the tendering document.
It also specified that the bidders must have access to at least Sh100 billion in liquid assets or a line of credit, and have an annual turnover of at least Sh95 billion, locking out many smaller firms in the country.
The State seeks to commence the project immediately and finish the entire design and construction works within three years, to boost JKIA’s constrained capacity and advance traveller experience.
According to the plan presented last week, the contractor will need to immediately commence work at the current JKIA main terminal to expand its capacity from 7.5 million per year to 12 million.
The same contractor will also be required to design and build a new terminal with a capacity of handling about 22 million passengers per year, and a new runway measuring 4.5 kilometres by 60 metres, capable of handling even the largest of aircraft families.
This new contract is a deviation from the former one signed with India’s Adani Group, which was a public-partnership project, where the developer was expected to build and operate the airport for a period of time before handing it back to the State.
Kenya Airports Authority acting CEO Mahamud Gedi last week told stakeholders that the new construction works will be fully funded by the State, including through the securitisation of the Air Passengers Service Fee.
“The government of Kenya is going to fund this project through a government funding model, not through a PPP as was previously decided,” he said at a stakeholder engagement forum last week.
The total cost of the upgrade works at the airport is yet to be disclosed, but the State has indicated that it will use the Sh18.5 billion Air Passenger Service levy to back a Sh154.8 billion bond for the expansion of the airport.
