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How did a mega-project in Lamu turn into a David vs Goliath case in court? It all started in 2012, when 28 farmers entered into an agreement with a Belgian energy company to erect wind turbines on their land. However, the deal went sour amid feasibility concerns and the project never broke ground.
The deal was cancelled in 2020 and most of the farmers involved accepted a KSh350,000 payout to cancel their contracts. Four farmers stood their ground, however, and are seeking KSh9 million in unpaid rent plus interest and damages.
The four farmers – Hezron Kinyanjui, Hoswel Kiberenge, John Gathairu, and Maria Thumbi – were among the 28 who entered into an agreement with Electrawinds Kenya Ltd. At stake was a KSh21 billion 90MW wind power project which, upon completion, would be the third-largest wind power project in Kenya.
As things fell apart, what came to be known as “the Malindi Case” ended up before the Malindi Environment and Land Court, where it came up for hearing on 27 November 2024.
From the alleged breach of contract with the landowners, to hundreds of squatters reportedly yet to be resettled away from a site to which the project was later moved, to a moratorium that halted development, and finally to the sale of the project for a mere dollar, much has happened to Electrawinds Kenya Ltd since the company first ventured into Lamu.
To begin with, Electrawinds Kenya Ltd no longer owns the Lamu wind energy project. Both Electrawinds Kenya Ltd and the project – now known as Bahari Wind Ltd – were subsidiaries of Elicio NV. Bahari Wind Ltd has since been sold for one dollar to Kenwind Ltd, a Kenyan company which was a minority shareholder of Bahari Wind Ltd.
Through its Kenyan representative, Susan Nandwa, Electrawinds Kenya Ltd had been looking for land on which to erect between 36 and 40 wind turbines for the generation of wind power in Lamu in 2011. “We did public participation and a feasibility study of a project of 90 megawatts, which is not a walk in the park. When we started this project, we put up masts to collect wind data,” Nandwa says. Electrawinds Kenya Ltd entered into individual agreements with 28 farmers in Lake Kenyatta to lease their land for 25 years.
Nine years later, in 2020, things changed. Nandwa says that that the data collected showed that the wind blows stronger near the sea and so they had to terminate the lease agreement. Nandwa did not share the results of the study backing this claim.
According to the lease agreement, Electrawinds Kenya Ltd had the right to construct wind turbines, erect poles, lay pipes, cables and undertake all other necessary underground works on the land. The agreement prohibited the landowners from selling or leasing out their land and committed to a payment of KSh250,000 every year for 25 years upon handover. The agreement did not mention compensation in case of termination.
In 2020, Nandwa showed up in Lake Kenyatta with an offer of KSh350,000 against cancellation of the lease agreements of the 28 landowners involved. Most accepted the offer, but four declined and proceeded to court, where they are seeking KSh9 million in addition to interest and damages.
Former Embu senator Lenny Kivuti, a shareholder in Bahari Wind Ltd, explains what transpired. “When Electrawinds went burst sometime in 2013, there was a takeover by Elicio, and there was no difference because the project continued,” he says.
Elicio N.V. sold Bahari Wind Ltd to Kenwind Ltd for a symbolic dollar in 2022. Elicio refers to the “Malindi Case” in the sale agreement, urging cooperation between the two parties – Elicio and Kenwind Ltd – for the speedy conclusion of the case. “The Purchaser and the Seller shall co-operate fully in all actions reasonably necessary to procure the satisfactory settlement of the litigation titled Malindi ELC No. E73 of 2021 (the “Malindi Case”),” states the agreement. “And in this respect, the Purchaser undertakes to contact the plaintiffs in respect of the Malindi Case as soon as reasonably practicable to negotiate and execute a settlement of the Malindi Case.”
Positioning for control
Things had been looking up at the time of signing the lease agreement with the farmers; a major win for the project came when the International Finance Corporation became involved, investing US$2.4 million (KSh310 million) in 2013.
However, by the end of 2013, Electrawinds Kenya Ltd had filed for bankruptcy and the acquisition by Elicio was finalised in mid-2014. Elicio is a Belgian public interest company with significant public ownership. It is part of the Nethys Group, a Belgian company which is in turn owned by Enodia which is 100 per cent publicly owned. The shareholders of Enodia are the Province of Liège (53.9 per cent), 74 municipalities (45.8 per cent), Brutélé and the Walloon Region.
At the time, Nandwa was an employee of Electrawinds Kenya Ltd, while Kivuti, a former Embu senator, was a consultant through his company Geomaps. The two had been introduced to each other by then Minister for Planning, Wycliffe Oparanya, as Nandwa was finding her footing in the project. Between the time of Electrawinds Kenya Ltd filing for bankruptcy and Elicio’s takeover, the two would allegedly position themselves for control of the wind power project.
With the registration of Kenwind Ltd and Kenwind Holdings Ltd, their government connections, and their contracts with Electrawinds Kenya Ltd (Nandwa as an employee Kivuti as consultant), the two were reportedly in pole position. Kivuti claims that Kenwind Ltd – a company in which he has part ownership – has shares in the wind power project. He says that Kenwind Ltd was given a 5 per cent stake in the project because it undertook most of the local work when the project was looking for land and applying for permits and licenses.
Nandwa was the majority shareholder of Bahari Wind Ltd in 2015. She sold the company to Elicio in 2020 for KSh100,000. There were six other minority shareholders with a total of 0.6 per cent of the shares. In 2018, as the IFC exited the project, it was paid US$2.4 million by Elicio, money which was raised from local investors including Clifton Energy, Afributech and Nerifa Holdings, which each contributed US$800,000 each through a Joint Development Agreement. The three exited the project in 2019. Kivuti says that they did not get their money back but that they would be refunded if there is financial closure.
Clifton Energy is fully owned by David Muge, an associate of President William Ruto’s. Nerifa Holdings is owned by Eddie Njoroge and Zephania Gitau, while Afributech is owned by Kivuti through his other companies Clearcut and Geotechnica. Njoroge is a former CEO of KenGen.
In 2017, three years before Nandwa sold Bahari Wind Ltd to Elicio, she sold her stake of 3,000 shares in Kenwind Ltd to Carolyne Mchome, Oparanya’s wife. Was it a coincidence? Despite not being a direct shareholder in the company, or being the line minister, Oparanya was part of the delegation when Kenya Power and Lighting Company and Bahari Wind Ltd signed a Power Purchase Agreement in January 2021.
Just a few weeks prior, in December 2020, Nandwa had allegedly signed a new land lease agreement on behalf of Elicio. Under the agreement, Kenwind Ltd – a company in which she had previously held shares – would own the land lease for the new project site on which hundreds of squatter families were living. Nandwa was fired by Elicio in February 2022 when the company finally found out about agreement.
In her defence, Nandwa says that Elicio had already decided to abandon the project and that sustained pressure for her to obtain a letter of support – without which the project wouldn’t have access to land – had left her with no choice but to sign the lease to Kenwind Ltd on behalf of Bahari Wind Ltd.
By 2022, Nandwa and Kivuti’s control of the project was complete when – after unsuccessfully putting the Bahari Wind Ltd in the market for months – Elicio finally sold it to Kenwind Ltd for a symbolic dollar. After pumping about €9 million (Sh1.2 billion) into the project, obtaining the land lease title, the necessary licences, and signing a Power Purchase Agreement, Elicio left. Now, the sale of Bahari Wind Ltd for a dollar is the subject of a government investigation in Belgium.
As of May 2024, Bahari Wind Ltd is owned by Kivuti (30 per cent), Nandwa (20 per cent), lawyer Carolyne Jerobon through her company Transequator (40 per cent), and her boss, Stephen Kipkenda of Kipkenda and Company Advocates, through his company Ololonga Ltd (10 per cent).
On the other hand, Kenwind Ltd – the company that bought Bahari Wind Ltd for a dollar in 2022 – is owned by Kivuti through his company Siakago Power Ltd (30 per cent), Wycliffe Opranya’s wife Carolyne Mchome (30 per cent), lawyer Carolyne Jerobon through her company Transequator (20 per cent) and Kahiro Kimani (20 per cent).
The peppercorn sale
Records show that due to losses associated with the project, the board of Elicio decided to sell the project in 2020 despite having signed a Power Purchase Agreement; a government moratorium issued in March 2021 affected those PPAs that were yet to be concluded or renewed as they came under the scrutiny of a presidential taskforce.
Three companies – Total Eren, Amea Power and Milele – had shown an interest in purchasing Bahari Wind Ltd but did not follow through and in July 2022, Elicio’s board voted to sell the project to Kenwind Ltd.
Kivuti says he beseeched Elicio to hand over the project to them for a dollar. “It was me who asked them. I told them that this project is very important to Kenya. And we don’t have money to buy it. Can you leave it to Kenyans? So, the one dollar is symbolic. We have a stake of 5 per cent. Can you leave it to us so that we look for a way we can get it done?” Kivuti says.
It is the circumstances surrounding this peppercorn sale of Bahari Wind Ltd that an Elicio insider is questioning. Damien Robert, who is a director of Enodia, has filed a complaint in Wallonia, Belgium, and the regional Walloon government has opened an internal investigation into the sale. In a September 2024 press release, Robert termed the sale “illegal and a waste of public money”.
Robert is further questioning how the €9 million that the company invested in the project was used. This amount was confirmed by Nethys’s current CEO, Grégory Demal, to Enodia board member Damien Robert.
“The project company used this money to pay for development studies, personnel, management fees, legal fees and other costs,” Demal explains in an email. In addition to Elicio’s internal costs for the project, which amount to €1.7 million, the total expenses for the project amounted to €9.1 million by the time it was sold.
Meanwhile, in Nairobi, Kivuti and Nandwa are adamant that the amount spent was much less and that the payments were mostly to Western companies that undertook most of the consultancies for the project. They maintain that the one dollar sale of Bahari Wind Ltd was above board. “There was no corruption whatsoever in the Elicio project. Not in Kenya. If there was corruption somewhere in Belgium, I don’t know and I cannot talk about that. But, in Kenya, no. Otherwise I would not even be standing here telling you I am in this project,” Kivuti says.
Kivuti claims that the delay in finding a buyer, coupled with the moratorium, frustrated Elicio. An investigation was launched in Belgium following a story first published in Belgian magazine Le Vif, which brought to light the sale of Bahari Wind Ltd which has not been disclosed to Enodia, the parent company – an obligation by law.
In mid-December 2024, François Desquesnes, Walloon Minister for Local Authorities, was expecting a report on the investigation into the sale of Bahari Wind Ltd from the regional administration. “The sales contract is part of the questions that we asked the regional administration,” he said, adding that the decision of the board of Elicio to sell could be rescinded.
This came to pass in early January 2025 when Desquesnes overturned Elicio’s decision to sell its shares in Bahari Wind Ltd to Kenwind Ltd. The Walloon regional government made the decision to cancel the sale on the grounds that the law had not been followed in the disposal of Elicio’s shares in Bahari Wind Ltd. Elicio ought to have sought a compliant opinion in line with Article L1532-5 of the Code of Local Democracy and Decentralization, a legal act requiring public companies in the Walloon Region or owned by municipalities to ask their public shareholder for permission to sell a subsidiary.
Further, the Walloon government’s decision puts the onus on Elicio’s parent company Enodia (which is owned by public entities and whose administrators are elected politicians) to right the wrongs by either rethinking the transaction or assess whether Elicio’s actions could be resolved administratively
According to the decision, “It will be appropriate for Elicio and Enodia to assess in particular the possibility of bringing the situation into administrative conformity. The decision is therefore annulled, but the sales contract is still effective.”
As the Walloon government ponders whether a new law should affect past administrative decisions, the Malindi case is looking into the breach of the contracts of the four Lamu farmers. They are representative of the many others whose rights have been trampled upon by big corporations looking to establish development projects without compensating individual land owners affected by their projects.
The entry of Bahari Wind Ltd, and the manner in which the relationship between Nandwa, Oparanya and Kivuti propels the project forward, is a testament to how in Kenya nepotism, cronyism and corruption play an important role in the choice of development projects to be initiated. That a publicly owned Belgian company would invest millions of euros in developing a project only to ultimately sell it for a symbolic dollar to its Kenyan collaborators even before the project breaks ground should interest Kenya’s anti-corruption authority.
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This story is supported by a grant from the Journalism Fund of the Wallonia-Brussels Federation.
