Kenya has prevailed in an international case, filed by WalAm Energy Inc. at the Washington-based International Centre for Settlement of Investment Disputes.
According to a document from Attorney General Paul Kihara dated July 10, 2020, seen by Kenyans.co.ke, the dispute relates to Suswa geothermal fields and was filed in ICSID in February 2015.
WalAm Energy sued the government following the cancellation of its Geothermal Resources Licence.
The company sought to have the licence reinstated and also sought compensation amounting to Ksh37 billion.
However, the tribunal dismissed the case and ordered that WalAm Energy shall bear its own legal fees and expenses and the entirety of the costs of the arbitration.
The company shall, therefore, pay the Government of Kenya Ksh 70,067,637 corresponding to its share of the costs of the arbitration.
WalAm shall also reimburse 75% of the government’s legal fees and expenses which are Kshs 441,082,797 and Ksh 27,244,384.60 respectively.
The Geothermal Resources License had been issued by the former Minister for Energy Kiraitu Murungi on September 5, 2007, under the Geothermal Resources Act of 1982.
It granted WalAm Energy exclusive rights to explore, drill for, extract, produce and dispose of geothermal steam and other geothermal resources in the Suswa area for a period of thirty years.
However, in October 2012, the government revoked the license after establishing that the firm had not performed its duties under the license and did not have capacity to undertake the required exploration and exploitation work.
The implication of the ruling is that the Ministry of Energy and the Geothermal Development Company (GDC) are now at liberty to exploit the geothermal resources in the Suswa Geothermal fields and grow Kenya’s energy capacity.
