Kenya Africa

KenGen Djibouti Debt Gets US$1M Offer

By Contributing Reporter · October 22, 2026 · 6 min read

White steam rises from the cooling units of the Olkaria V geothermal power station in Kenya's Rift Valley, with green hills and power lines behind it — The Olkaria V geothermal power station in Kenya’s Rift Valley, one of KenGen’s plants. File photo. (Photo: Macabe5387, CC BY-SA 4.0, via Wikimedia Commons)

KENYA · LISTED COMPANIES

Key Facts

—The country Kenya is East Africa’s largest economy, and KenGen, its biggest power producer with a 54% market share, is 70% state-owned and listed in Nairobi.
—What happened Djibouti’s state geothermal agency, ODDEG, offered KenGen a first instalment of US$1,000,585, about Sh129 million (about US$1 million), on invoices of US$2,126,128, KenGen’s 2026 annual report says.
—The contract KenGen won a 2021 contract worth Sh709.8 million (about US$5.5 million) to drill three Djibouti geothermal wells; drilling has since ended.
—The numbers KenGen earned Sh10.35 billion (about US$79.7 million) after tax and Sh59.7 billion (about US$459.8 million) in revenue in the year to 30 June 2026.
—The warning Kenya’s Auditor-General says weak contract terms with foreign clients put timely payment at risk; KenGen has set aside Sh545 million (about US$4.2 million).
—What it means for you The offer on the KenGen Djibouti debt is about 0.2% of annual revenue, a small test of how a Nairobi-listed utility collects from foreign customers.
—Still open No payment date is given, and about US$1.13 million of the debt would remain unpaid even if the first instalment arrives.

Djibouti’s state geothermal agency has offered to pay Kenya’s KenGen about US$1 million on a debt from a 2021 drilling contract. The offer on the KenGen Djibouti debt, about Sh129 million (about US$1 million), is a first instalment on invoices of US$2.13 million.

For US investors, the debt tests how well a Nairobi-listed utility collects money from foreign customers. Djibouti also hosts Camp Lemonnier, the main US base in the Horn of Africa, and is developing geothermal power near Lake Assal.

What KenGen’s Annual Report Says

KenGen’s report for the year to 30 June 2026 says the Djibouti Office of Geothermal Energy Development, known as ODDEG, has acknowledged the debt. ODDEG proposed an initial payment of US$1,000,585 as the first instalment against outstanding invoices of US$2,126,128.

Chief executive Peter Njenga signed the management note on 4 September 2026, and Business Daily, a Nairobi newspaper, reported the offer on Wednesday 21 October. If the first instalment arrives, about US$1.13 million of the KenGen Djibouti debt would remain unpaid.

How a Kenyan Firm Ended Up Drilling in Djibouti

KenGen won the contract in February 2021 to drill three geothermal wells for ODDEG, worth Sh709.8 million (about US$5.5 million). KenGen announced on 25 November 2021 that it had started the first well.

The wells are at Gale Le Koma near Lake Assal and are meant to feed a 15-megawatt pilot plant, the Afrik21 news site reported. The African Development Bank has lent US$24.73 million for the Lake Assal programme since 2013, it added.

A tall brown basalt cliff rising above green bush and grassland in Hell's Gate National Park, Kenya, under a grey sky — A basalt cliff in Hell’s Gate National Park, beside the Olkaria geothermal fields where KenGen built its drilling skills. File photo, 2014. (Photo: Ninara, CC BY 2.0, via Wikimedia Commons)

Why the KenGen Djibouti Debt Took So Long to Collect

Kenya’s Auditor-General, the state audit office, flagged the problem in its review of the previous year’s accounts. It found overdue claims on non-commercial clients of Sh1.27 billion (about US$9.8 million), of which two foreign firms owed Sh850 million (about US$6.5 million).

The Auditor-General blamed weak contract terms, and KenGen has set aside Sh545 million (about US$4.2 million) against such debts. Management’s reply to that finding is where the report names ODDEG and the US$1 million offer.

How the KenGen Djibouti Debt Fits Its Results

In the year to June 2026, profit fell 1.2% to Sh10.35 billion (about US$79.7 million) as revenue rose 6.4% to Sh59.7 billion (about US$459.8 million). The board proposed a final dividend of Sh0.75 (about US$0.006) a share, down from Sh0.90 (about US$0.007).

Revenue from drilling and consulting abroad fell to Sh122.1 million (about US$0.9 million) from Sh263.6 million (about US$2.0 million) a year earlier. KenGen says drilling in Ethiopia and Djibouti has ended and it is negotiating new work in Djibouti and Zambia.

Who Owns KenGen

The Kenyan government owns 70% of KenGen and the public holds the other 30%, according to the annual report. The company’s shares trade on the Nairobi Securities Exchange, and the Rio Times keeps a KenGen Company Intelligence profile.

KenGen built its drilling skills at the Olkaria geothermal fields in Kenya’s Rift Valley, where it said in 2021 it had drilled over 300 wells. On 14 October the Rio Times reported on an unfixed licence flaw at Olkaria.

What It Means for US Readers

For US investors in African utilities and drillers, the KenGen Djibouti debt shows how slowly even a state agency can pay under a signed contract. At about 0.2% of annual revenue the sum is small, but it is real cash on a debt the Auditor-General flagged.

Djibouti hosts Camp Lemonnier, the main US base in the Horn of Africa, so its finances and energy plans matter to Washington. The Rio Times described its pressure from two nearby wars on Monday 19 October.

What Is Not Known

KenGen has not said when ODDEG will pay the US$1 million or whether the offer has been formally accepted. The report does not say how the rest of the KenGen Djibouti debt, about US$1.13 million, would be settled.

The dates of the original invoices are not given, and the report does not name the two foreign firms behind 70% of the overdue balance. It is also unclear when KenGen will win its next drilling contract in Djibouti or Zambia.

More: Kenya news in English, every day from The Rio Times.

Frequently Asked Questions

What did Djibouti offer KenGen?

Djibouti’s geothermal agency ODDEG proposed a first instalment of US$1,000,585, about Sh129 million (about US$1 million). KenGen’s 2026 annual report says the payment would start settling invoices of US$2,126,128.

How much does Djibouti owe KenGen?

KenGen puts the outstanding invoices at US$2,126,128, or about Sh276 million (about US$2.13 million). The KenGen Djibouti debt comes from a 2021 contract to drill three geothermal wells.

Why is KenGen drilling in Djibouti?

KenGen sells its geothermal drilling and consulting skills abroad to diversify beyond selling electricity in Kenya. It has also worked in Ethiopia, Eswatini and Tanzania.

Is KenGen listed and who owns it?

KenGen shares trade on the Nairobi Securities Exchange. The Kenyan government owns 70% and the public holds the other 30%.

Does the KenGen Djibouti debt change the company’s outlook?

The US$1 million offer is about 0.2% of KenGen’s Sh59.7 billion (about US$459.8 million) annual revenue. It matters more as a sign that a long-running foreign debt may finally be paid.

Sources: KenGen, Integrated Annual Report and Financial Accounts 2026, September 2026; Business Daily, Djibouti offers KenGen first payment for five-year-old debt, 21 October 2026; KenGen, KenGen commences drilling of first well in Djibouti, 25 November 2021; Afrik21, Djibouti: KenGen starts drilling on the Gale Le Koma geothermal site, 2021.

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