Sh164bn Lamu coal plant gets green light

Centum-Gulf Energy consortium yesterday got the green light to construct a Sh164 billion coal plant in Lamu after the public private partnership petitions committee threw out a bid to halt the project.

A consortium comprising China’s Hebei Construction Investment Group (HCIG) and Kenyan Liketh Investments had submitted an application to the team, challenging a decision by the Ministry of Energy and Petroleum to award the tender.

The group will now hold talks with the ministry to set up the 1,000-megawatt plant, nearly half of the country’s current power generating capacity.

In its application, Hebei Construction argued that the award to Gulf Energy consortium was unlawful as it was not evaluated under the same parameters as the two losing bidders, including another consortium comprising Shanghai Electric Power Company Limited, Avic International and Cistenique.

The petitioner also pointed out a possible case of double tendering, allegedly involving the winning bidder.

INDIVIDUAL BIDDER

Initially, Tata Power of India was pre-qualified to submit a proposal for the project as an individual bidder.

The firm was also approved under another consortium, where it had partnered with Gulf Energy andc’s Exxaro Energy Resources Limited and Cennergi Pty Limited, which led to its disqualification.

It is understood that Gulf Energy raised the issue of the anomaly with the Energy ministry in February last year and sought to be allowed to change the membership of the consortium in order to comply with the law.

In its ruling on Tuesday, the PPP petition committee said that Section 46(7) of the PPP Act allows withdrawal and replacement of a consortium member provided the group remains eligible.

Chairman Kihara Muruthi said the petitioner was aware of the reconstituted consortium since April last year, but did not file a petition within 15 days, as required by the law.