Akiira project plans drilling start for two additional wells for June 2016
Reported today from Kenya, Akiira Geothermal Ltd, a consortium developing a geothermal power project in Naivasha, Kenya, is planning to invest an additional Sh1.4 billion ($14 million) for the drilling of two additional wells for its 70 MW project.
Drilling of two more wells will start in June in Akiira Valley in Naivasha, The project last month received a Sh138 million grant from the African Union Commission.
Exploration drilling of the first well will start early June to be possibly followed by a second one at a total cost of $14 million (Sh1.4 billion), said Robert Bunyi, the outgoing chief executive of Akiira.
A steam well takes about 60 days to drill, reaching depths of up to 3.5 kilometres. The geothermal project is expected to inject 70MW to the grid in the next 18 months, or end of next year. The electricity will cost Sh9.3 per unit (9.23 US cents).
Akiira was to start power generation by December but suffered delays after exploration of its first two wells yielded less steam, prompting further drilling and tests.
The company started exploration in August last year, targeting to drill up to 15 steam wells, each with an average capacity of 5MW, bringing the expected installed capacity to about 75MW.
Mr Bunyi said that project financing is through a mix of debt (70 per cent) and equity (30 per cent), meaning the Centum consortium will contribute about Sh9 billion out of the required Sh30 billion.
The project is partly funded by US President Barack Obamas Power Africa initiative that aims to light up the continent by tapping into renewable energy.
It received a $1 million (Sh101 million) grant two years ago from the US-based Overseas Private Investment Corporation (OPIC) to meet its technical and legal expenses.
The company last August signed a power purchase agreement (PPA) with electricity distributor Kenya Power indicating December 2016 as the generation date for the 70MW. It will not meet the deadline. Mr Bunyi said the PPA allows for a change of date for power generation, depending on the availability and viability of steam.
Mr Bunyi said the PPA allows for a change of date for power generation, depending on the availability and viability of steam.