Government Wins Case in UK Against British Firm

  • An aerial view of London, UK File
  • Attorney General Paul Kihara led the government to a major victory as Kenya won a case against a British Energy firm in their own backyard, United Kingdom.

    The AG's team also comprised of Solicitor General Ken Ogeto and a British lawyer. 

    A London-based International Arbitration Tribunal dismissed a Kshs2.6 billion claim by UK's Cluff Geothermal Company and its local partner, Great Rift Drilling.

    An image of Menengai Geothermal field

     The UK company had accused Kenya's Geothermal Development Company (GDC) of breach of contract. 

    In 2013, GDC entered into a contract for provision of drilling services for 20 geothermal wells as its Menengai geothermal field for approximately Ksh4.2 billion.

    However, the UK company and its local partner stopped work on March 2015 and declared a dispute, accusing the Kenyan firm of failing to pay some invoices. 

    By the time the case was referred to the London-based tribunal on August 13, 2017, the Kenyan company, GDC, had paid about Ksh1.9 billion.

    On June 3, the London-based tribunal ruled that GDC would pay the UK company approximately Ksh226 million in respect of invoices issued for work done.

    It also ruled that a further close to Ksh60 million also be paid as interest.

    This makes the total award Ksh286 million, instead of the Ksh2.6 the firm had demanded, saving Kenyan taxpayers more than Ksh2.3 billion.

    However, the amount due is likely to accumulate should Kenya delay paying, after the tribunal awarded a daily interest of about Ksh46k.  

    AG Paul Kihara