Inside Politics

State plans to revive Sh56b Greenfield terminal project

Thursday, August 26th, 2021 00:00 |
Kenya Airports Authority Managing Director Alex Gitari when he appeared before PIC over audited accounts of the agency. Photo/PD/SAMUEL KARIUKI

Kenya Airport Authority (KAA) is planning to revive the controversy-ridden Sh56 billion Greenfield Terminal project that was stopped four years ago.

The authority is facing a Sh7.6 billion demand note from the contractor, Anhui Construction Company, a matter still pending in court.

It had terminated the ambitious project at the Jomo Kenyatta International Airport (JKIA), ending Kenya’s dream of having the largest terminal in the continent.

The decision was based on prevailing operational, economic and financial dynamics, which have been on a downward during the period.

Alex Gitari, KAA managing director, told a parliamentary committee yesterday that plans were afoot to revive the project and that his office had entered into negotiations with the contractor to see how the Sh 7.6 billion would be settled.

“A team has been set aside to engage the contractor in negotiations on how the matter should be settled,” Gitari said when he appeared before the Public Investments Committee (PIC).

Gitari was, however, put to task to explain the position of Sh4.2 billion paid to the contractor as commitment fee.

“You have told us about the ongoing negotiations to settle the money owed to the contractor but you have not mentioned anything to do with the commitment fee,” said committee chairman Abdulswamad Nassir.

Gitari told the committee that the country lost a good opportunity to expand its major airport which is the hub of the region in terms of the holding capacity.

He said before Covid-19 struck, plans were in progress to expand JKIA to a capacity of between seven and eight million passengers.

President Uhuru Kenyatta launched the project on November 13, 2013. The terminal was to be the largest in Africa.

The largest airport terminal in the region, in terms of capacity, is South Africa’s OR Tambo’s central terminal, with a capacity of 12 million passengers.

Expanded capacity

The SA terminal is followed by Egypt’s Cairo airport terminal three with a capacity of 11 million and Sham-el Sheikh, also in Egypt, with 7.5 million. The JKIA has expanded capacity at the new Terminal 2 by 2.5 million passengers.

“When this is added to the original capacity of JKIA’s 2.5 million passengers, the total installed capacity rises to 7.5 million in 2016 against an actual passenger number of 6.5 million, leaving an excess capacity of one million,” former MD Yatich Kangugo told the PIC when he appeared to explain the collapse of the Greenfield project.

“It is envisaged that by the time the modernisation of Terminal 1B, C and D is done, the total handling capacity will increase to a peak of 10.5 million passengers per annum,” he added.

The authority said it remains confident that the ongoing modernisation and expansion of the JKIA hub is adequate to positioning the airport as the aviation gateway for the region.

Mooted under the Grand Coalition Government as part of flagship Vision 2030 projects, he project was approved by the KAA board, Cabinet, Parliament, public procurement authorities and the Ethics and Anti-Corruption Commission.

The Greenfield Terminal project had been designed to encompass construction of a four-level terminal building comprising a central processing area, a transit hotel, landside retail centers, arrivals and departures plaza.

Ancillary facilities included an access road, car parking, access taxiways, Ground Service Equipment and bus parking areas.

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