Tatu City oxygen manufacturing plant secures Sh2.9 billion funding

Oxygen Air Separation Unit. [iStockphoto]

Hewatele, a local medical oxygen producer has secured $20 million (Sh2.9 billion) in funding from the US International Development Finance Corporation (DFC), Finnfund, Soros Economic Development Fund (SEDF), UBS Optimus Foundation and Grand Challenges Canada.

The firm will use the debt and equity funds raised to finance the building of the Cryogenic Medical Liquid Oxygen Air Separation Unit plant at Tatu Industrial Park.

Set to commence operations early next year, the facility will fill the rising demand for medical-grade liquid oxygen in healthcare facilities across Kenya, Uganda and Northern Tanzania.

"Hewatele's investment, backed by the world’s preeminent development finance institutions and foundations, represents a transformation of healthcare in Kenya and across East Africa,” said David Karimi, deputy country head, Kenya, at Rendeavour, the owner and developer of Tatu City.

Founder of Hewatele Dr Bernard Olayo said the medical oxygen plant represents a significant leap in ensuring sustainable and affordable access to medicinal oxygen. "The increased production capacity here at Tatu City will improve oxygen affordability, particularly for maternal and child healthcare, and enhance primary healthcare support,” he said.

According to the Ministry of Health, demand for medical oxygen has increased significantly since Covid-19 period - from 410 tonnes per month to 880 tonnes per month.

Hewatele’s facility will boost the production of medical oxygen by at least 20 tonnes per day. According to the company, improving access to oxygen and administering oxygen can reduce child mortality by pneumonia 35 per cent.

SEDF Chief Executive Georgia Keohane said: “As a catalytic social impact investor focused on direct impacts and longer-term, systemic change, SEDF sees the investment in Hewatele as an important commitment to strengthening Africa’s rapidly expanding healthcare sector.”

More than 75 local, regional and global businesses are operational or under development in Tatu City, as well as 3,000 homes and apartments.

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