The African Development Bank (AfDB), a multilateral development finance institution headquartered in Abidjan, Cote d’Ivoire, has withdrawn from planned multimillion-dollar funding for Sosian Menengai Geothermal Power, a 35-megawatt geothermal power plant previously controlled by Kenyan businessman Narendra Raval.
The move comes after Gideon Moi, a Kenyan legislator and one of the sons of Kenya’s late president, Daniel Arap Moi, repurchased a majority stake in the geothermal venture as part of a concerted effort to recover some of the family’s assets.
According to Business Daily, sources close to the Akinwumi Adesina-led multilateral development finance institution revealed the funding snag after revelations that Moi bought back a majority stake in Sosian from Raval.
“At the moment, the bank is solely focused on the Quantum Power East Africa project. It has previously been involved in the Sosian project as well, but a change in shareholding is required before it can engage further,” a source confirmed to Business Daily.
AfDB demanded a change in ownership as a condition for funding Sosian Menengai Geothermal Power for its planned project, nearly eight years after the geothermal venture was awarded rights to build a 35-megawatt steam plant from Geothermal Development Company.
Due to the delay in the construction of Sosian Energy’s 35-megawatt steam plant, Raval sold his stake in the venture to the Moi family nearly five years after spending Ksh80 billion ($699.9 million) on geothermal assets through Devki Group.
According to experts, the AfDB’s decision to withdraw from the planned funding is a setback to the government’s recent move to diversify its energy mix in order to decarbonize the energy sector and reduce the country’s energy costs.
With a proven potential of 7,000 megawatts, geothermal energy from Kenya’s geologically active Great Rift Valley forms the cornerstone of a government scheme to boost energy production.
The Moi family is said to be Kenya’s second-largest landowner, after the Kenyatta family, with nearly 300,000 acres of valuable property in its portfolio.
The family owns the vast majority of Standard Media Group, which includes the well-known television network Kenya Television Network, as well as newspapers and radio stations. The Moi family’s fortune is estimated to be worth more than $3 billion, according to unofficial figures in Kenyan media.
Nearly five months ago the Moi family sold a 51-percent ownership stake in Siginon Aviation Limited, a Nairobi-based logistics, and aviation handling firm, to National Aviation Services.
The family collected a total of Ksh1.7 billion ($15.2 million) from the sale of the Nairobi-based logistics and aircraft handling firm while keeping a controlling 12-percent shareholding in Siginon Group.