Cablegate: Kenya Aspires to Build a Nuclear Plant by 2015

R 041259Z DEC 08
FM AMEMBASSY NAIROBI
TO SECSTATE WASHDC 7809
INFO USDOC WASHDC 3116
AMEMBASSY ADDIS ABABA
AMEMBASSY ASMARA
AMEMBASSY BUJUMBURA
AMEMBASSY CAIRO
AMEMBASSY DAR ES SALAAM
AMEMBASSY DJIBOUTI
AMEMBASSY KAMPALA
AMEMBASSY KHARTOUM
AMEMBASSY KIGALI
AMEMBASSY LONDON
AMEMBASSY PARIS
USMISSION UNVIE VIENNA

UNCLAS NAIROBI 002716

STATE FOR T MARC HUMPHREY, EEB/ESC/IEC, EEB/ESC/ENR, OES/SAT,
OES/ENV, AF/E, AND AF/EPS

COMMERCE FOR SARAH LOPP AND BECKY ERKUL

LONDON AND PARIS FOR AFRICA WATCHERS AND REOS

E.O. 12958: N/A
TAGS: ENRG TRGY EINV SENV BEXP BTIO KE
SUBJECT: KENYA ASPIRES TO BUILD A NUCLEAR PLANT BY 2015

REFS: (A) STATE 127423 (B) NAIROBI 2381 AND PREVIOUS

1. As reported in ref B, although it has no known fissionable
material, Kenya aspires to build its first medium-sized 1,000 MW
nuclear plant by 2015 as part of a multifaceted strategy to boost
power production. The Government of Kenya (GOK) will appeal to the
private sector to finance the plant's estimated $1 billion
price-tag. According to a Ministry of Energy (MOE) prospectus,
"Investment Opportunities in the Energy Sector," released in early
October before a three-day national energy conference, the
government will offer potential investors a 30-year power purchase
agreement on a build-own-operate-transfer (BOOT) arrangement.
Private British investors are reportedly considering helping Kenya
build this facility. Possible construction sites have already been
identified in the Rift Valley, Nyanza Province near Lake Victoria,
and Coast Province to serve Mombasa.

2. Since mid-summer 2008, US Mission Nairobi officers from both
State and Commerce have held a series of meetings and roundtables
with Ministry of Energy Permanent Secretary Patrick Nyoike and
senior representatives of the Kenya Electricity Generating Company
(KENGEN), among them, Managing Director Eddy Njoroge and Director of
Business Development Albert Mugo, the Kenya Power and Lighting
Company (KPLC), including its Chief Manager for Planning David
Mwangi, and independent power producers. Judging from these
meetings and the MOE prospectus, the nuclear option is among the
least likely of a number of power generation possibilities available
to Kenya. Development of the country's rich geothermal resources,
now estimated at a potential 7,000 MW, remains the government's
preferred option.

3. Should the nuclear plant come on line, we expect that the
Ministry of Energy (rather than a new government agency) will
oversee its operations.

RANNEBERGER

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