ACWA to build Mozambique coal power project

The government of Mozambique has signed a 25 year concession contract with a consortium led by ACWA Power, for the development of the Moatize coal fired power project in Tete, Mozambique.

ACWA Power, the lead developer, investor and operator of the project, is working with mining company Vale and Mitsui Co. Ltd, on the construction of the 300 MW first phase power project. State owned utility, Electricity de Mozambique (EDM) and local investor Whatana Investment Group will also enter as minority shareholders in the project.

Independent power project

The Moatize IPP is a green field independent power project with a total investment cost of approximately US$ 1000 million. It will be a pulverised fuel, subcritical coal fired power station. The coal will be supplied by Vale from the adjoining mine.

Approximately 250 MW of the total 300 MW capacity will feed the largest coal mine in the world being developed by Vale, with the remaining 50 MW supplied to EDM to feed the state electricity grid.

Construction and operation

The companies have selected international contractor GS Engineering & Construction from Korea for the engineering, procurement and construction (EPC) of the project. ACWA Power’s wholly owned subsidiary, NOMAC, will be responsible for the operation and maintenance of the plant.

The project is expected to be the first large scale green field power project in Mozambique to be financed using the Project Finance framework. When in operation, the power plant will contribute a significant amount of electricity capacity into the Mozambican grid.

Socio economic impact

In addition to supporting the economic development of the country by augmenting power generation capacity, the project will also inject significant socio economic value into this underdeveloped and remote part of Mozambique by creating in excess of 2800 jobs during the construction phase and approximately 160 permanent skilled jobs during the operational life of the plant.

The sponsors of the project have also committed to a comprehensive community development programme, including the training of approximately 1000 local people.

Mozambique electricity generation

CEO of ACWA Power, Paddy Padmanathan, commented: “Signature on this concession agreement is a significant milestone for the Moatize IPP project enabling us to complete the financing process and commence full scale construction. Moatize IPP will significantly enhance ACWA Power’s position as a rapidly expanding power developer in the Southern Cone of Africa, one of our target markets and also helps to diversify ACWA Power’s fuel experience beyond oil, gas and solar to now coal, all the while making a significant addition to the electricity generation capacity of Mozambique and contributing to the socio economic development of the country.”

Adapted from press release by Katie Woodward

Read the article online at: https://www.worldcoal.com/power/17032014/acwa_to_build_mozambique_coal_power_project_626/