The Zambians and Chinese sign power plant deal – a move to avert power deficit
Posted by African Press International on November 22, 2007
By Wilfred Zulu
API/APN in Lusaka– Zambia and a Chinese firm have signed a US$243 million deal to construct a 360 megawatts capacity power plant – a move meant to avert the looming power deficit caused by increased demand in a Southern African country. much of the funding is expected to come from a named Chinese Bank.
Synohydro Corporation of China has been engaged to extend the 600 megawatt Kariba North Bank power station owned by state utility, Zesco. The project is located on Zambezi River at Kariba Dam, 223 kilometres south of the capital, Lusaka. The projected is expected to be completed within three years.
The engineering, procurement and construction contract will be financed by the Export Import (EXIM) Bank of China to the tune of 85 percent of the total project cost, while the balance will be sourced from other institutions.
Zesco managing director Rhodnie Sisala told API*APN that discussions so far indicated that the financial closure of the deal would take place early next year and the implementation would commence immediately afterwards.
He added that Zesco had engaged a consortium of transaction advisors to assist in negotiations and mobilizing the required financing resources to cover up the remaining 15 percent financial void.
The advisors include Development Bank of Southern Africa, United States’ based Fieldstone, and Le Boeuf Lamb & Mc Rae.
And Energy Minister Kenneth Konga said at the signing ceremony on Tuesday that Government had set high targets for industrial and household access to electricity that would require large amounts of power.
“Bearing in mind the rapid electricity demand growth being experienced and the anticipated deficit, the country is in a hurry develop new power generation sources,” said Konga.
Studies by Southern African Power Pool (SAPP) show that due to the high economic growth taking place in the region, the demand would exceed the installed capacity from next year.
Published by API/APN africanpress@chello.no
