Jomo Kenyatta Airport Project Greenfield in excavation stage

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While the Kenya Airports Authority (KAA) is currently in talks to conclude the financing of their most ambitious project ever undertaken yet, the expansion of Jomo Kenyatta International Airport (JKIA

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While the Kenya Airports Authority (KAA) is currently in talks to conclude the financing of their most ambitious project ever undertaken yet, the expansion of Jomo Kenyatta International Airport (JKIA) with the new “Project Greenfield,” sees excavation work reportedly progressing well already, preparing for the start of the main construction of the new terminal, parking aprons, and a second runway.

President Kenyatta officially broke ground late last year and the new terminal, due to bring the airport’s overall passenger capacity to more than 30 million per annum, up from the present nearly 7 million passengers using JKIA each year, including a growing number of transit passengers.

It is understood from a source in Nairobi that KAA is talking to several financiers, including China’s EXIM Bank and the African Development Bank, in order to tie up the 85 percent of loan finance needed over and above the 15 percent of the project cost to be paid directly from KAA’s cash flow. The overall cost presently stands at over 56 billion Kenya Shillings but may rise over the coming years as is almost the norm with such mega projects, making it hugely important to get the right financial deal into place with affordable interest rates, a decent grace period until at least construction is completed and a stretched repayment time frame to allow KAA service the loans without running into financial difficulties.

“There is talk that the excavation may be completed by July this year and KAA therefore is under time pressure to finalize the financing deals. In fact we are wondering because the contractors were supposed to arrange for such finance if we got the details right at the time when the tenders were awarded. But there is still a bit of time and because this is a presidential pet project, was for Kibaki and remains so for Kenyatta, KAA better perform and deliver on this count,” added the source while discussing the project once again yesterday.

Project Greenfield, while of importance to KAA and the aviation industry as a whole in Kenya, is of even greater importance to national airline Kenya Airways, as their entire growth strategy over the remaining 8 years of their strategic plan is based on this capacity boost coming on line sooner rather than later.

On April 4, Kenya’s national airline will receive the first of overall 9 ordered Boeing B787-8 Dreamliners, with a further 5 due for delivery in 2014 while 3 more are due to join the fleet in April, June and July next year. Additionally will another Boeing B777-300ER join the fleet this year as are a number of single aisle narrow body aircraft expected to be delivered to support the airline’s growth plans for more flights and more destinations.

Since Kenya Airways has now leased out 3 Boeing B737-300 to subsidiary Jambojet, which is due to launch flights on April 1, they will have to make up for this by bringing more B737NGs on line.

Present parking capacity though at the main terminal’s Unit 1 and 2, where international flights are processed, is at its limit and the completion of the new Terminal 4 and the additional temporary terminal are still many months away, causing some concern among Kenya Airways’ top management. The general mood gauged is that it is now a race against time by KAA to be ready as the airline’s fleet continues to grow, due to double by around 2018 from the present number of aircraft to nearly triple by 2022. A source close to Kenya Airways had this to add: “At every turn of the way has Kenya Airways’ top brass hammered home the message that unless the airport capacity grows and the building projects mature, or in the case of Greenfield progress, they will have nowhere to go when the new aircraft arrive. Already are a number of aircraft parking overnight across the region and when they all come into JKIA in the morning, in particular the time between say 6 and 8 a.m. you can see just how packed all the available parking areas are. There were times when every aircraft would be parked outside Units 1, 2 and 3 but today you are lucky to get a parking position there. Most aircraft now have to park way outside on very distant parking positions and passengers are bussed to the arrival hall. Kenya Airways has a point here. By the end of this year there will be quite a few more wide bodied jets around and even though they will progressively retire their aged B767 fleet, space must be created of that bottle neck will otherwise have a big impact not only on KQ but also other airlines wanting to come to Nairobi or wanting to increase flights.” Nail on the head comes to mind and the planners at Kenya Airways will no doubt have a few sleepless nights ahead of them trying to deal with such challenges, create contingency plans and generally try to fit another few grains of sand into the proverbial hour glass.

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Editor in chief is Linda Hohnholz.