Indian financier short-lists two power bids for energy project

By Staff reporter | 20 Jun 2019 at 12:56hrs
Bulawayopower
The Export-Import Bank of India (Exim Bank), which four years ago extended a US$87 million line of credit to Zimbabwe for the repowering of the 72-year-old Bulawayo Power Station, has short-listed two bidders from the Asian country vying to upgrade the thermal- powered plant.

Zimbabwe is faced with acute shortage of electricity, generating about 1 000 megawatts (MW) against a national demand at peak hours of about 1 700MW. The situation has been exacerbated by dwindling water levels at Kariba Dam, which supplies water for power generation to Kariba Hydroelectric Power Station.

Kariba Power Plant, which has the capacity to generate more than 1 000MW has now been forced to generate less than 500MW due to low water levels at the Kariba Dam.

To cover for the shortfall, the power utility imports electricity from regional suppliers especially Eskom of South Africa and Hydro Cahora Bassa of Mozambique.

However, Zimbabwe has not been importing enough electricity because of the acute shortage of foreign currency in the country.

Exim Bank of India also extended an additional US$23 million recently to go towards the  Bulawayo power project.

Zimbabwe Power Company (ZPC) acting managing director, Robson Chikuri, confirmed the latest development to Business Times. He, however, did not disclose the identity of the two bidders.

"Two Indian companies have been short-listed and the winner will be announced soon," Chikuri said.

The development comes after ZPC and the State Procurement Board, which has been replaced by the Procurement Regulatory Authority of Zimbabwe, two years ago rejected a tender bid by an Indian consortium, Thyssen Krupp Industries in partnership with Technofab Engineering (Private) Limited.

Technofab Engineering, as was first reported by  Business Times has since been awarded the right to rehabilitate the Deka Pump Station and the construction of a new 42 kilometres pipeline which will draw water from the Zambezi River to Hwange Thermal Power Station, for cooling and electricity generation.

The consortium had emerged as the sole bidder for the project following a pre-qualification bidding process by the project financiers, the Exim Bank of India.

But, the Indian consortium's bidding price was higher than the project's budget, resulting in ZPC and the SPB in 2017 calling for the tender to be re-floated.

The loan has a 13-year tenure, a grace period of three years and a repayment period of 10 years at two percent interest rate per annum.

The rehabilitation of the power plant, which entails the installation of new technology, is expected to play an immense contribution in the provision of electricity in the country.

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