Kenya: The Government has signed a Sh42 billion deal with a Chinese communication company for construction of the first three berths of Lamu port, part of the ambitious Lamu Port South Sudan Ethiopia Transport (Lapsset) corridor.
President Uhuru Kenyatta also announced the Government had set aside Sh4.45 billion for immediate kickoff of construction works.
The funds, he said, will also compensate those who will be affected by the Lapsset project. “The Sh4.45 billion includes funds for compensation of persons affected by the project. I am therefore directing the ministry responsible for lands to complete the process of compensating those affected by this project as soon as possible,” Uhuru said after signing the contract in State House, Nairobi, yesterday.
This took place after a Government audit uncovered irregular land allocations in Lamu, including land reserved for the port. President Kenyatta said the land-grab was part of a criminal conspiracy now causing runway insecurity in the region.
President Kenyatta gave an assurance to residents living along the corridor that they will be compensated. Once the port is complete, the second transport corridor, will open up parts of Northern and Eastern Kenya and a link via railway to the rich oil fields of South Sudan and Ethiopia.
“The commencement of this project reinforces the Government’s resolve to make infrastructure a key facilitator of our social and economic development. It is a major milestone in delivering the Lapsset corridor programme as well as achieving Kenya’s Vision 2030,” he said.
The seven project components of the Lapsset Corridor Programme have a budget estimated at Sh2 trillion in construction costs. The Lamu Port with its 32 berths alone will cost approximately $3.1 million, the railway $7.1 million while the crude oil pipeline will cost a further $5 Million.
“We expect the port to be complete and fully operational in the next five years. A lot of ground has already been covered including providing power supply. Under construction are several roads such as the one linking Moyale to Isiolo and one from Moyale to the Ethiopian border with Kenya,” said Silvester Kasuku, Director General and Chief Executive Lapsset Corridor Development Authority. Also present at the ceremony was Lapsset project chairman Francis Muthaura.
Muthaura announced that initial project disbursements have been funded and work will commence next month through M/s China Communication Construction Company and Supervision Consultants Yashoon Engineering, the contractors of the three berths.
It is estimated that construction of the three berths of the Lamu Port will end in 2019, hastening construction of the other 29 berths.
Construction of the three berths in Lamu is of immense significance to the Lapsset corridor projects in supporting a crude oil pipeline and coal plant among others.
The timeline of this project is at 20 years with some of its components such as the Isiolo-Merille road. At the peak of the project, between 2013 and 2018, it is expected that the Kenyan Government will be spending about six per cent of the country’s Gross Domestic Product or 16 per cent of its annual budget on the project.
“We project that over a million people will be employed in Lamu in all sectors from shipping, at the port, service industry, banks and other commercial establishments,” said Kasuku.