Bloomberg
Construction
Daniel Manduku
Djibouti
Ethiopia
International Monetary Fund
Kasuku
Kenya
Kenya Ports Authority
LAPSSET
Lapsset Corridor Development Authority
Manduku
Mombasa
SEE
Silvester Kasuku
South Africa
South Sudan
Sudan
The Government
The National Treasury
Transnet
Transnet SOC
Tullow Oil
Uhuru Kenyatta

SA firm eyes deal to operate Lamu Port

Kenya is in talks with Transnet SOC of South Africa to operate a seaport that the East African nation is developing to partly use for planned exports of oil.

The state-owned South African logistics company is leading a group of companies that are pitching to provide the equipment for the initial three of 32 berths planned at Lamu Port, and to operate the facility, Kenya Ports Authority Managing Director Daniel Manduku said.

“We are still negotiating,” Manduku said in an interview with Bloomberg, without specifying the value of the deal. “We hope to have made a decision by end of March.”

President Uhuru Kenyatta is seeking to increase private investment to expand infrastructure and boost economic growth.

SEE ALSO :Kentrade pledges support for Lamu Port venture

That is as the International Monetary Fund advises the Government to restrain spending to further reduce its fiscal deficit from 7.5 per cent of gross domestic product at the end of June 2018.

The National Treasury earlier said a group of companies is seeking a 25-year public-private partnership to operate the Lamu port.

Lamu will be Kenya’s second international seaport after Mombasa. It was conceived as part of a regional infrastructure plan known as Lapsset that includes an oil pipeline from northwestern Kenya, where Tullow Oil plans to start commercial production in 2022.

The Lapsset corridor envisages linking the pipeline, roads, rail and airports in Kenya to neighbouring Ethiopia and South Sudan.

Construction of the first berth at Lamu will probably be completed in June, and the next two areas where vessels can dock in 2020, according to Lapsset Corridor Development Authority Chief Executive Officer Silvester Kasuku.

The Government is expected to spend $480 million (Sh48 billion) to construct the three berths, Mr Kasuku said.

Calls to Transnet seeking comment went unanswered.

The port is expected to attract larger cargo ships and also provide direct benefits within the region by passing on savings derived from lower marine costs due to faster ship turnaround time, reducing the cost of doing business.

It is expected that the port will attract some of the cargo that passes through the ports of Sudan, Djibouti and Mombasa.

Lamu port traffic is expected to reach 23.9 million tonnes by 2030, according to industry forecasts.

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