31 May 2014

Mozambique: France and Mozambique Sign Power Station Agreement

Maputo — The Mozambican and French governments signed in Maputo on Friday an agreement whereby France will provide 52 million US dollars to finance the participation of the Mozambican public electricity company (EDM) in the construction of a gas-fired power station at Ressano Garcia, on the border with South Africa.

The project, co-financed by EDM and by the South African petrochemical company Sasol, is budgeted at 270 million dollars. It will draw on natural gas from Pande and Temane, in the southern province of Inhambane, that will fire a new station at Ressano Garcia, producing 175 megawatts of electricity.

The Friday agreement was signed by Finance Minister Manuel Chang and by the executive director for operations of the French Development Agency (ADF), Jean Marc Gravellini.

Speaking at the ceremony, Chang said the French funding will guarantee the participation of EDM in the capital of the new power station. The new station, he added, will make use of a local resource, the Inhambane gas, and will provide electricity at the lowest possible cost.

It would also reduce substantially the energy dependence of southern Mozambique on South Africa.

Currently, power from the Cahora Bassa dam on the Zambezi for Maputo and the rest of southern Africa must pass through South Africa. Furthermore, at peak moments, EDM is obliged to import power generated in South Africa.

“This will allow EDM to develop experiences in structuring public/private partnerships, which will be precious for the perspective of future investments in electricity generation and transmission”, Chang said.

There is already one gas fired power station at Ressano Garcia, operated by the company Aggreko, which can generate 232 megawatts.

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