Family-owned construction materials manufacturer Devki Group has inked a Sh25.5 billion deal with Chinese firm Sinoma Energy to power its Mombasa-based raw steel processor and the new Athi River cement clinker plant.
Sinoma said in regulatory filings last week the kiln waste-heat project at Devki’s new cement plant in Athi River and the another to power Devki’s new Sh45.5 billion steel plant in Kilifi will be built over a period of 20 months to produce 53.5 megawatts (MW).
Devki earlier said it plans to inject billions in the region’s first raw steel production plant seeking to exploit locally sourced iron ore. Its National Cement Company has also invested in a Sh28 billion clinker and 15MW power plant located between Merrueshi and Mbirikani in Kajiado County.
“Sinoma Energy Saving Company Ltd and Kenya’s Devki have signed a cement kiln waste-heat power generation project general contract and a Spong iron self-supplied power plant project general contract,” said Sinoma in the regulatory statement.
“The total installed capacity of the two projects is 53.5MW, and the total contract amount of the project is RMB 170 million (about Sh25.5 billion).”
“The project (over a period of 20 months) is to provide residual heat for these two production lines.”
Devki chairman Narendra Raval had last July said all design drawings as well as environmental impact assessment audits for the Kilifi-based steel plant with an annual capacity of 300,000 metric tonnes had already been approved.
“Only South Africa has an industrial raw steel production plant and our plan is to give Kenya steel products manufacturers cheaper access to industrial raw steel. We will exploit local iron ore mines thereby helping us generate new wealth and jobs,” he had said.
The first phase will see Devki and its financing partners invest Sh20 billion in the plant that was expected to create 1,600 direct jobs and 9,000 indirect jobs in related activities like mining and transportation when it starts production in 2020.