Nairobi — The governments of the United States, Finland, and Canada have joined hands to fund a sustainable medicinal oxygen manufacturing facility in Tatu City, Kiambu County.
Hewatele, a Kenyan medical oxygen producer, has secured a $20 million (approximately Sh2.9 billion) funding package from various organizations, including the U.S. International Development Finance Corporation (DFC), Finnfund, Soros Economic Development Fund (SEDF), UBS Optimus Foundation, and Grand Challenges Canada.
This funding will be utilized to build a modern cryogenic medical liquid oxygen air separation unit plant at Tatu Industrial Park, the first of its kind in East Africa in the last 60 years.
The facility is expected to commence operations in late Q1 of 2025 and will address the increasing demand for medical-grade liquid oxygen in healthcare facilities across Kenya, Uganda, and Northern Tanzania.
David Karimi, Deputy Country Head, Kenya, at Rendeavour, the owner and developer of Tatu City, said the investment is a transformation of healthcare in Kenya and East Africa.
"Hewatele's investment, backed by the world's preeminent development finance institutions and foundations, represents a transformation of healthcare in Kenya and across East Africa," he said.
Bernard Olayo, founder of Hewatele, said the investment shows significant potential to enhance access to medicinal oxygen, particularly for maternal and child healthcare.
"This medical oxygen plant represents a significant leap in ensuring sustainable and affordable access to medicinal oxygen," Olayo said.
"The increased production capacity here at Tatu City will improve oxygen affordability, particularly for maternal and child healthcare, and enhance primary healthcare support," he elaborated.
According to Kenya's Ministry of Health, demand for medical oxygen has increased significantly since the COVID pandemic, from 410 tons per month to 880 tons per month.
As a result, Kenyan hospitals frequently experience unpredictable deliveries, higher prices, and expensive transportation costs for medical oxygen.
Due to the high production costs, fragmented delivery, and storage options, medicinal oxygen is typically eight to ten times more expensive in sub-Saharan Africa than it is in Europe and North America.
Hewatele's facility aims to boost the production of medical oxygen by at least 20 tons per day, reducing costs for rural and urban healthcare customers by up to 30 percent.
Administering oxygen can reduce child mortality from pneumonia by 35 percent, lessen fetal distress, and save lives when given to women during pregnancy.
Johanna Raehalme, Finnfund's Head of Origination in Africa, said that the rise of the COVID pandemic made everyone around the world aware of the importance of oxygen supply.
"We are happy to add yet another important investment in our healthcare portfolio and see that the increased awareness of oxygen will ensure market demand for Hewatele going forward," he stated.
Georgia Levenson Keohane, CEO of SEDF, emphasized the significance of investing in Hewatele as a means to strengthen Africa's healthcare sector. SEDF views this investment as crucial for generating direct impacts and fostering long-term systemic change.
Maya Ziswiler, CEO of the Optimus Foundation, highlighted their early support for Hewatele due to its clear impact and innovative business model.
Zulfiqar Wali, CEO of Hewatele, expressed gratitude for the opportunity to expand to Tatu City, which will create jobs and stimulate the local economy in Kiambu County.
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Tatu City hosts a diverse array of businesses, including both local and global entities, underscoring its business-friendly environment.
The city is experiencing significant growth, with thousands of homes and apartments under construction and several thousand students studying at its schools.
More than 75 local, regional, and global businesses are operational or under development in Tatu City's business-friendly location, including CCI Global, Heineken, Dormans, Copia, Cooper K-Brands, Grit Real Estate Income Group, Twiga Foods, Freight Forwarders Solutions, ADvTECH, Friendship Group, and Davis & Shirtliff.
It is also home to more than 3,000 housing units and apartments that are occupied or under construction, and 4,500 students study at Tatu City's schools.
