Insider Letter Exposes Shocking Details Of Corruption, Fraud, And Mismanagement At GDC

An insider has blown the whistle on the Geothermal Development Company (GDC), exposing an intricate web of corruption, fraud, and mismanagement that has plagued the organization under the leadership of CEO Paul Ngugi.

In the letter copied to Kenya Insights, the allegations range from fraudulent procurement practices to mismanagement of staff pension schemes, and from CEO’s balance scorecard failures to questionable staff management practices. Below is a copy of the report against the company.

1. Fraudulent Procurement of Goods and Services.

Geothermal Development Company is in a web of procurement  of substandard Scientific Equipment, Drilling Equipment and Materials just to mention but a few. Under the Leadership of Proclaimed Rogue CEO Paul Ngugi who robbed the GDC Staff Pension Funds, now all Procurements inclusive the low value Procurements have to go through his office for approval. We have had many tenders cancelled anytime the Tender evaluation committee fails to adhere to his office directives.

In recent days. The Company has had to procure and pay his cronies products that did not meet the user acceptance specifications.

Elab Chemicals Ltd located in Thika supplied Drilling Detergent 1st Tranche valued over 60 million, facilitation of the Payment was expedited by the Ag GM Drilling Operations Reuben Ngosi following the Directives of the CEO.

The said Detergents failed the Laboratory testing results (See Attached below) This led to instability of well 2C Sunk in Paka now fearing for its collapse despite fishing expeditions that has cost the Well over KES 1 billion having drilled 2200M with a Target depth of 3,000M.

Mountain Investment Ltd recently supplied substandard water Distillers at an exaggerated price of over KES 1 million,  over 60 substandard faulty Gas flasks. All this failing at the inspection committee but paid altogether.

We are calling for Sanctions of an Incompetent Drilling Department that has further lost an additional more than 400 million in Drilling downtime in the Current Financial year.

The GM Drilling Operations has been behind controversial tenders that have led to loss of Funds for the Organization. Recently a Supplier sought clarity if Three Officers from the Tender evaluation had been sent by the CEO when it turned out they were working for Reuben Ngosi yet part of the Kickback had already been delivered to the Office of the CEO.

Our Cry is the Organization is losing Funds and we seek the office of the EACC to undertake a Lifestyle Audit of the Senior Management at GDC. Today the Drilling Department is openly rejecting all external jobs  currently, including one from Baker Hughes as the Company Rig equipments have been canibalised to a shell.

2. Management of Staff Pension Scheme

Geothermal Development Company Staff Retirement benefits scheme changed Administrator services over 2yrs ago. The remainder term of the New Administrator  is less than 8 months yet historical member data has never been shared. From the Trustees Boardroom desk, the elephant in the room is complex.

There seems to be a syndicate that involves the regulator RBA. Any staff or member who raises a voice faces the wrath of Paul Ngugi. We are currently campaigning to make replacements of the Trustees but the Interference from The Sponsor who happens to be also a Trustee of the Board is at another level.

The Sponsor nominated Trustees Irene Moinkett whose two terms have lapsed after joining the Board on 1st May 2018 (See attached Annex 2 and 3) which indicated her unapproved foreign trip. Irene has vehemently refused to leave office under the Protection of the Sponsor all in a bid to cover up for her Masters.  Currently Paul is marshaling to have his cronies elected in the Board to Continuously cover up the rot at the Pension scheme.

Following whistle blowing by members on Procurement of Scheme service Providers  Interference to PPRA. Trustees were sanctioned. Unfortunately the Trust Secretary who refuses to leave office together with her Chairman Peter Kariuki working on directives of the former Chairman now CEO Paul Ngugi discarded all the Procurement Documents in a bid to cover up for malpractices. Our Cry to RBA has gone to deaf ears due to their involvement in cover-up and failure to act on all material matters raised.

3. CEO’s Balance Scorecard

The CEO has failed the Company and Kenyans terribly in his first year in office. The CEO scorecard targets to deliver 22Mwe through Drilling of 6 wells. The company has only realized 2Mwe in the current Financial year (Less than 10% target).

The recent Geothermal Advisory Board (GAB) calling out the Company Drilling Operations for being Jua-Kali Ops and not in any way certified to carry out the job at hand. The GAB report further certifies Menengai Steam Outputs declining and therefore no sufficient Power for Three Power plants. Geothermal Resource Management staff are now demotivated and have reported Sosian Power plant as inefficient and wasting Steam which Management seems hell bent on calling them out.

The recent Advisory report highlights Weak Project Costings in the organization with Under reporting of the real actual cost of our wells and extremely Weak Project structures. To cover this up Paul Ngugi has been marshalling a swipe of Geothermal Resource Management and Strategy Research and Innovation General Managers all in bid to cover up their individual incompetencies.

Power plant Operations have no Staff, tools and Critical spares. The current management style of Paul Ngugi and General Manager GRD Cornel Otieno Ofwona is to have breakdowns so that they can benefit from Emergency Procurements together with Penalty kickbacks.

4. Staff Management

Paul Ngugi has surrounded himself with a cabal of women whom staff refer to as Devils. The Devils have failed to deliver the Collective Bargaining Agreement (CBA) nor the HR instruments for him. (See Attached Annex 4) We believe the Women have a spell on him. One Year since Paul Ngugi came into office he has failed to hold an EXCOM meeting since he fears to be accountable.

Failure to deliver a CBA has caused sneers and jitters within the organization leading to an accelerated staff turnover as the Organization. Top cream in the most Critical Department of Geothermal Resource Assessment (GRA) are leaving.GRA is run by a Non Geologist who has been touting of Paka field as having an excess of 100Mwe.

Recent findings indicate the field has less than 70Mwe and the Power plant has to be scaled down drastically, and GDC financial viability now seems not as rosy. Whereas that Korosi field drilled Wells producing a Big fat ZERO steam output. There is a major outcry with Staff having been in the same Job description for over a decade.

However, to his Darling Girlfriend Rose Wangechi Muhia who has been on maternity leave  half of her working life, things are exquisitely awesome where  she remote controls Paul Ngugi through her curvaceous body; making Paul deliver a board paper ready to make Rose Muhia, a full legal manager. We are now asking How? Whenever the Lady is not on Maternity, she is Full time traveling twice abroad with Paul Ngugi and once with the Board and having risen from Job Group 8 Unionizable to an Acting Manager Job Group 3. With a Proposal to make her full Manager JD2 without Interviews. Where on earth did we go wrong?

Paul Ngugi is now aloof and isolated with his Board, Staff, The Union,  Executive Management (EXCOM),  Managers, and The Ministry are all fed-up with his indecisiveness. With Staff asking “Why can’t Paul take an early retirement if he cannot do the job? Why waste the organisation’s resources by not doing the job that he is paid to do? While Presiding over the development of unrealistic strategy documents that call for KSH 20B budget per annum.”

We are in Limbo since KfW financing for 2024-25 Financial year has not been approved  yet the budget is soon to be read.