Source: $70m for Harare power plant | The Herald March 23, 2018
Golden Sibanda Senior Business Reporter
THE Zimbabwe Power Company is set to meet senior officials from Jaguar Overseas Limited (JOL) in a preparatory meeting ahead of imminent release of $70 million by Afreximbank for rehabilitation of Harare Power Station.
The Herald Business also gathered that the impending meeting provides an opportunity for the parties to discuss, during another eagerly awaited high stakes discussion, issues on delays by JOL in starting work on the re-powering of Munyati, which has not progressed since being awarded in 2015.
ZPC had sought permission from State Procurement Board (SPB) to cancel the contract for re-powering of Munyati Power Station awarded in 2015 to the Indian company citing JOL’s delays in securing funding to rehabilitate the power plant.
ZPC acting managing director Engineer Joshua Chirikutsi said they will soon meet officials from Jaguar over Harare, amid expectations that Afreximbank will release the requisite funds.
Harare Power Station, whose last generators were commissioned in 1942, has been producing power intermittently after it was de-commissioned in 1970. Re-powering entails replacing old boilers with new technologies that increase the power output as well as the efficiency of the plant.
“We will be meeting Jaguar Overseas (officials) in a preparatory meeting for the start of works. This is just to make sure that when the funds are released, they find us prepared.”
Eng Chirikutsi said significant progress had been made towards the release of funds, which has been on the cards since 2014, but had not progressed as JOL had not secured funding.
Things came to a complete head when it emerged that Eximbank of India, who were initially expected to fund the project, had turned down JOL’s funding request over allegations that the Indian contractor was not standing with the bank.
Jaguar was contracted by the Zimbabwe Power Company to re-power the Harare station by replacing the old plant with a modern diesel fired one, which has better capacity and efficiency.
Re-powering of Harare Power Station was scheduled to take 24 months and will ameliorate Zimbabwe’s crippling power deficit and raise the plant’s generation capacity from 90MW to 120MW.
India Eximbank did not give reasons for rejecting the funding request, but sources privy to the development said it was because “Jaguar Overseas” no longer was in good standing with it.
A source said the Indian firm, awarded the engineering, procurement and construction contract to rebuild the plant’s generation capacity, is now in a quandary over the issue of funding.
When India Eximbank shut the door in its face, Jaguar approached Afreximbank as an alternative source of funding, but faced another hurdle in the form of maximum project funding, since the bank could only fund to limit of $50 million.
ZPC’s other re-powering projects (small thermals) include Bulawayo where Government had secured an $87 million line of credit from the Government of India to add 60MW to the grid.
Problems have emerged again on the project amid indications India wants the project re-tendered.
Re-powering works on Munyati Power Station are expected to go on for 2 years and this will add 70MW to the national grid once it is completed.
The power plant was built as station 1, 2 and 3. It had capacity of 21MW and was commissioned in 1942. It was de-commissioned in 1970, as it had become uneconomic to operate.
Station 2 had capacity of 75MW when it was commissioned in 1955, but was later de-rated to 20MW due to uneconomical units. It had nine chain-grate boilers and 6 turbo-alternators.
With a capacity of 60MW, the station’s plant 3 consisted of pulverised fluidised boilers. The power plant also had two large turbo-alternator machines with capacity to produce 30MW each.
According to ZPC, plants 2 and 3 operated independently, but were linked electrically through four interconnector transformers.
The engineering, procurement and construction tender awarded to JOL to re-power the Harare entails replacing 15 boilers with modern technology, refurbishing 2×50 megawatt steam turbines, overhauling cooling towers, water treatment plant, civil works, dredging and rehabilitating a weir on Munyati River for water supply to the power plant.