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Kirubi-backed firm gets NEMA nod to build Lamu coal power plant

Source: Money & Markets

Construction work for the billionaire Chris Kirubi backed Sh200 billion (US$2 billion) Lamu Coal Power Project is set to begin after the Kenyan government’s environmental watchdog brushed aside public protests and issued it with an environmental compliance license.

National Environmental Management Authority (Nema) issued the licence to Amu Power on September 7, 2016 paving the way for the company’s promoters to start building the coal power plant.

Amu Power Company was in September 2014 awarded the tender to build a 1050 megawatt coal powered electricity generation plant in Lamu Islands on the Kenyan coast and has secured Sh150 billion (US$1.5 billion) financing from Standard Bank of South Africa and Industrial and Commercial Bank of China (ICBC).

Nairobi Securities Exchange listed investment firm, Centum, where Kirubi, is the majority shareholder, is the anchor shareholder in Amu Power Company. In implementing the Lamu project, the firm is in a consortium with Gulf Energy together with three Chinese firms China Huadian, Sichuan No 3 Power Construction Company and Sichuan Electric Power Design and Consulting Company.

Lamu residents under Save Lamu lobby group have opposed the construction of the plant in the island and have vowed to go to court if it gets the environmental approval.

According to the Sierra Club, the proposed Lamu plant does not employ the best available technology to limit pollution, and it will begin operation without Selective Catalytic Reduction (SCR) to reduce nitrogen oxides.

UNESCO has also expressed reservations on the project being put in Lamu which is designated as a World Heritage Site.

Last month, Lamu county’s trade, tourism, culture and natural resources executive Samia Omar Bwana resigned his post over the project. In a press statement explaining her resignation, Samia said he had read the environmental and social impact assessment report of the project and found that the power plant would have irreversible damage on Lamu residents and environment.

“I will not be comfortable holding a position that will require me to promote the interest of the investors in this coal project,” said Samia in the press statement.