admin
Business Reporter
ZIMBABWEAN mining giant RioZim needs about $2.1 billion to build power plants that would produce up to 1,400 megawatts of electricity at its vast coal concession in Gokwe’s Sengwa area.
The company’s chief executive officer Noah Matimba said on Monday that RioZim was talking to the regional power trading firm Southern African Power Pool and big Zimbabwean electricity users about an agreement to sell them electricity.
He told a parliamentary committee that his company needed $2.1 billion to build power plants generating between 200MW and 300MW for a daily total of 1,400MW.
“We do need a power purchase agreement in order that we can attract investors or attract those lenders that can give us (money),” Matimba said.
“We’ve signed an MoU with the Southern African Power Pool in the hope that we can begin to discuss a power purchase agreement with them and be able to create the necessary demand to attract investors.”
RioZim, a gold miner and shareholder in Rio Tinto’s Murowa diamond mine, has a coal concession at Sengwa, in north western Zimbabwe that holds 1.36 billion in coal deposits.
The power station project is capable of generating up to 2,000MW of power, almost as much as Zimbabwe’s total installed capacity.
The proposed project envisages the construction of a number of smaller power plants over the next ten years.
In order to achieve this goal, RioEnergy is in the process bringing in technical partners to help construct the power station.
Last year foreign investors from Indian state-owned Bharat Heavy Electricals Limited and Shandong of China, expressed interest in partnering RioZim in setting up 250MW plants in Sengwa as part of its short term strategy.
RioZim also engaged an Indian consultancy firm WAPCOS to update the bankable feasibility study to ensure potential investors are provided with reliable information on the resource.
The proposed power project is set to help ease incessant power outages that have been blamed for stifling industrial productivity and investment.
On Monday, the Zimbabwe Power Company (ZPC) said electricity production was 801MW compared with peak demand of about 2,200 MW following a temporary shutdown at Hwange Thermal plant due to technical faults.
Hwange is the largest power plant in the country with installed capacity of 920MW but produces less than half that electricity due to ageing equipment and lack of maintenance.
Electricity shortages have been blamed for keeping away potential investors.
ZPC said last month plans were underway to build new power station to generate 3,500MW at a cost of $5 billion.
Online Reporter