Mombasa industrial park set for Sh90 billion power plant, AI project

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Mombasa is set to host a $700 million (Sh90 billion) energy and artificial intelligence (AI) infrastructure project, following a partnership between Amaco Energy S.A and Arise Integrated Industrial Platforms (ARISE IIP) Kenya.

The Hercules project would be built at the Coast Integrated Industrial Park in Dongo Kundu, with an initial generating capacity of 250 megawatts that could grow to one gigawatt.

It would combine power generation, cooling systems and infrastructure for AI and data centres on the 500-acre site near the Port of Mombasa.

The project falls under the government and Afreximbank country programme. It is being developed by Arise IIP.

The Dongo Kundu SEZ is one of Kenya’s flagship industrialisation projects and has attracted strong interest from logistics companies, manufacturers and energy investors.

Its proximity to the Port of Mombasa and key regional transport corridors positions it as a strategic gateway for trade within East and Central Africa.

 Many investors view the zone as an opportunity to reduce logistics costs and improve efficiency by locating production closer to port facilities.

Despite this optimism, investors say that readiness to invest has not been matched with the availability of basic utilities needed to support industrial activity.

Some firms have already secured land and begun preliminary development, but full-scale investment decisions are being delayed until infrastructure gaps are resolved.

While government agencies continue to implement major infrastructure projects within the zone, industry players warn that delays in electricity connectivity, access roads, water supply and sewer systems could slow down investment timelines if not addressed urgently.

Investors say that without these essential services, companies may be forced to postpone factory commissioning or incur higher operational costs.

Most of the firms investing in the area are expected to generate cargo for export through the port of Mombasa.

However, under a memorandum of understanding signed on November 6 this year at the Kenya Ports Authority (KPA) headquarters in Mombasa, the two firms will jointly carry out the technical, commercial, environmental, regulatory and financial assessments needed to move towards implementing the project to power the investments.

Amaco Energy Chief Executive Theodore Theodoropoulos said the project would link power generation to the data centres and industries that will use it.

“The project will start with 250 megawatts, but this can be expanded to 1,000 megawatts. The project will be in full operation in 20 to 24 months,” he said.

He said Kenya’s challenge has been the availability, reliability and affordability of power. “Hercules is built on a straightforward principle: develop the power with the data centre and the industries that will use it. Mombasa brings together a port, international connectivity and an expanding industrial base. Working with Arise IIP Kenya gives us the setting to develop an integrated solution around real infrastructure requirements,” he said.

Arise IIP Kenya Country Head and Chief Executive George Olaka said the partnership would help develop energy and cooling infrastructure alongside the park, supporting firms that want to expand manufacturing, processing and digital services.

He noted that the site links industrial land with a major East African trade gateway and an international submarine cable landing point.

“Connectivity brings the world to Mombasa. The next task is building the infrastructure that allows businesses to produce, process and compute here at scale,” he said.

The first phase will use liquefied natural gas (LNG) to generate power, supplied through a floating power barge.

The system is designed to shift towards hydrogen and renewable energy as technology and economics allow.

According to the project overview, Mombasa has near-term electricity demand of 1,350 megawatts across its port, industrial and digital sectors, with another 300 megawatts needed for a proposed desalination plant.

The project would occupy about 500 acres within the Dongo Kundu Special Economic Zone, with a similar offshore footprint.

It is expected to create 1,500 to 1,850 jobs during construction. Once running, it could offer 350 to 400 direct specialised jobs and 200 to 250 indirect ones.

Arise IIP is also advancing other industrial and digital projects at the Coast, including the Vipingo Special Economic Zone in Kilifi County.

The project is still at the development stage. Detailed engineering, regulatory approvals, financing and commercial agreements remain to be completed.