The 60 MW project is expected to cost 6 billion Shilling (USD 76.5 million) and JBIC will meet 80% of the total amount. The manager, Kenya Generating Company (KenGen), is also partly funding the project. Even though JBIC has already provided a bulk of the loan according to schedule, the completion date has been pushed back from mid-2003 to the first quarter of 2004. A suspension of construction work would further delay the project.
The official reason given for the delay in disbursement is "ongoing changes in the Japanese Government". However, according to Africa Intelligence Energy, the reason is more likely to be JBIC's unease over the way KenGen has been handling the HEP, notably with respect to the local community. Several environmental and human rights groups have expressed concern about forced resettlements, lack of compensations, and broken promises for electricity supplies and irrigation facilities. Replying to NorWatch, Veidekke has earlier rejected the complaints.
Conflicts were highlighted last December, when one of the protesters, Argwings Odera, was shot and arrested by the local police assisted by guards representing the consortium in which Veidekke is partner. Odera had earlier written to the Japanese Government to account for the position of the protesters. The arrest of Odera coincided with a visit to Kenya by then Japanese Prime Minister Yoshiro Mori. The second tranche of the loan was withheld shortly thereafter.
Norwatch Newsletter 5/01