ZESCO has signed a deal with Australia’s African Energy Resources to transmit power to Southern Province from the Aussie firm’s coal-fuelled station in Botswana.
The memorandum of understanding (MoU) was signed for the importation of 300 megawatts of base load electricity power from the Sese Coal and Power project in Botswana.
The Australian-based exploration company will undertake a desktop study to evaluate preferred options for the transmission and integration of power supply from Sese into Southern Province.
The report says preliminary studies have confirmed that there are no material flaws in the transmission options under evaluation.
According to information posted on Proactive Investors Australia website the agreement is non-binding at this stage with Zeasco and Maysen and Borowski Investments, an Australian corporate advisory firm.
“Zesco will provide access to its technical capability and information to assist with the study, and Maysen and Borowski will assist African Energy Resources Limited and Zesco in meeting key objectives,” the report says.
The parties have agreed to explore the potential for the delivery of 300MW of base-load electrical power from African Energy Resources’s Sese Coal and Power project into Zesco’s grid, 500 kilometres to the north. African Energy Resources’ shares may trade firmer after signing [this] agreement,” it says.
The report says Zambia is currently experiencing a period of strong economic growth centred on new mine and smelter developments in Copperbelt Province.
It says with the expansion of several existing large-scale mines, there is a substantial increase in demand for power.
Meanwile, ZESCO says works for the US$2billion Kafue Gorge lower is progressing well and the company to undertake the construction will be hired soon.
Zesco acting chief operations officer Christopher Mubemba said tender documents for the five shortlisted constructors will be issued soon while securing finances for the project will follow later in the year.
Mr Mubemba said this in Livingstone at the just-ended Engineering Institute of Zambia gala dinner.
The Kafue Gorge lower is one of the Zesco’s major projects with a capacity of 750 megawatts (MW) and will cost an estimated US$2 billion while construction will take six years.
“In terms of financing, US$1.5 billion is a loan and US$500 million is equity. We have had a lot of support from Government. From the US$750 million Eurobond, Zesco was allocated US$186 million,” he said.
Mr Mubemba said there is need to invest in electricity to sustain Zambia’s economic growth, adding that power is the key to industrial development of an economy.
“The biggest challenge we face is dealing with the peak period when the company faces a deficit of 200 to 300MW per day,” he said.
He said the US$320 million power rehabilitation project (PRP) embarked by the company has helped with rehabilitation of generation, transmission and distribution infrastructure to stimulate the growth of the country.
He cited the upgrading of Kafue Gorge station to 990MW from 900, Kariba station to 720MW from 600MW as one of the major achievements of the PRP.
The rehabilitation of Victoria Falls hydro-electricity power station in Livingstone attracted US$53 million, Kafue Gorge (US$85 million) and Kariba (US$81 million).
Mr Mubemba said works at Kariba North Bank extension, which has attracted US$420 million, is almost finished and a second machine will be commissioned next month.
Commenting on the US$232 million Itezhi-tezhi project, Mr Mubemba said the company has had problem with raising funding but on Tuesday last week, a final agreement was signed with investment partners.
“Despite the fact that financing arrangements were not put in place, Zesco was innovative and looked for money from other sources; we borrowed from Government and also used our own balance sheet.
As I speak the work is 48 percent complete despite financing been finalised last week,” he said.
The 120MW Itezhi-tezhi project is due for completion next year.
Ubu bufi botswana currently has a power deficity how can it expor to zambia, they had a power blackout for weeks and had to import from mozabique, even now power is eratic
Anti-Second Term Campaign starts now!
Save the Great Zambia!
Maamba Coal mine is in Southern province, so dig that coal, cross it into Botswana, and get some electricity back. Pollution will stay in Botswana.
Ubufi Indeed!!!! Botswana is currently in dear need of power!!!!
Hold fire guys! I think this is temporal measure whilst all other projects come to completion and fruition. I am actually encouraged by this news. Power to the people – in this context I power as in electricity to all all even those that live in ‘cabins’
Rural electrification is a must if we have to be productive and automated in most things that we do. This will allow a level playing field for our villages and their inhabitants. I commend the government for this drive! Just one concern, it seems this £750million bond never finishes – is it magical? First, an allocation to ZR, then hydro power…..etc
@Nostradamus 1.2 – good one!
Maysen and Borowski is the one that facilited the dinner called meet the president in Perth during the common wealth meetings. I knew they were after something and now they are getting the benefits.
PF govt. Do we serously need to import power? This looks like some way to make money by someone
Beef from Botswana and now electricity from Botswana! What about the abundant perenual rivers of Zambia? Kabompo, chambeshi, mukubwe, mulungushi, lwangwa, mukushi, luapula, zambezi, kalambo, oooch, so many rivers that can provide envirnmental friendly electricity. When are we gonna use our heads to tap into these potential natural resources, when? Wehavelow cost labour that can be mobilised in dams construction, if the olden pharraohs of Egypt made those pyramids so many years ago why can we fail today other than laziness at thought and at practical work? Not even our Maamba coal has done us any wonder, but now Botswana electricity. Can we do much more things differently and innovatively. If not why not.
@Ba Floyd, ati mobilize “people” to construct dams. Which people, Zambians??? I will imagine how those dams will be collapsing.
Just let people from Southern province get some imported electricity also.
@Floyd Chitalu, you are spot on. If anything, Zambia should be an exporter of Power to neighbouring Counties. To tap into all the Hydro power potential Zambia has, we need a can-do attitude and make individual small scale mini- hydroelectric Plants like Charles Mubanga Mumba has done — > *********
We are content to live with endless potential. It busts my head how people feel proud to talk about their potential 50 years after independence. That is why despite having just about two-thirds of the water body of the region you still have water shortages and now have to import power instead of setting up installations. I know some missionaries who have set up small-scale power plants within the country and they are doing their institutions and surrounding communities a lot of good.
@Nostradamus- Ndiwe nsanya. Galu opanda mu chila indeed!!!!
From power exporter to power importer….clearly the results of lack of longterm strategic planning. So Zesco has LAMENTABLY FAILED to deliver yet the management still retain their contracts only in poor Zambia.
We have 365 days of sunshine and we still not plugging-in this alternative energy.
We should take a leaf from Charles Mubanga Mumba and many like him who remain unknown —-> h t t p://kumatoo.com/charles_mubanga_mumba.html
Charles made his own mini- hydroelectric Plant in rural Zambia and he is only a grade 12. As the saying goes ‘Necessity is the father of invention’.
Thanks to President Sata and PF. This is the best they can offer us?
Efyo tupona nipanonopano. I see the down fall of our country. Where are we going when we have the power from their to Congo and Tanzania? Chimwi no Plan game here is on the flow.
@Nostradamu, Maamba coal is a useless Indian company. It does not pay its workers well. It has no pension plan for workers, no group life insurance and no health benefit. It is a company as useless as Indians are. Zesco shall nationalise and run Maamba collieries.
If the Indians go you will have no coal mining happening. You are flocking to the useless Indians’ country to get your careless health taken care of and you are also relying on them to run your copper mines. Why don’t you show the mettle and do those things yourselves before you call the Indians useless???
Kafue weed,Liverpool substation,Lizard disruption of power,power be restored any time,prepaid,tarriffs,energy regulation board,turbines,euro bond,deficits.Zambia is A Christian Nation.
By April,2012 no more load shedding.What type of lies are we going to hear please.Namwishiba tukayapya no to kondo pamo.LESA UMWINE EWISHIBE.
WHAT A DISGRACE. DOWNRIGHT SHAMEFUL!!!!
Restructure Zesco and bring them to NYSE, will raise equity and then all the black outs will be a thing of the past. It doesn’t take a genius to figure out this, it takes progressive minds. lyonse kulomba ne nkongole sha kaloba even when your profile qualifies you to list on the best stock exchange.
I take this with a pinch of salt! Currently, Botswana is importing power from Zambia! The northern town of Kasane imports power from the Victoria Falls Power Station in Zambia! How can we then we import power from Bots? Can someone please explain this paradox?
Wow, Zesco is borrowing $1.2 Billion for this project? Don’t get me wrong, I understand the potential of this industry, but I wonder what the numbers are in terms of revenue generated once the project is completed? Will revenues from this project match or exceed the debt service payments? Or is another debt burden being placed on the future generation?