Interim power specialist Aggreko, of the UK, and black economic-empowerment company Shanduka unveiled plans earlier this month for a 107 MW temporary gas-fired power plant, in Mozambique, which will supply electricity to the utilities of both countries over a two-year period.
The facility will be fuelled by gas from Sasol’s Temane gasfield and the electricity will be bought by South African power utility Eskom and its Mozambican counterpart, Electricidade de Moçambique (EDM).
Power purchase agreements (PPAs) have been concluded with both Eskom and EDM, with Eskom signing up for 92 MW of the available capacity and EDM 15 MW.
The commercial terms of the PPAs were not disclosed, but the joint venture expects revenues of $250-million over the operational period, which should begin in October and continue through until July 2014.
Eskom is planning to use the power to bolster its baseload capacity ahead of the introduction of new generation capacity from the Medupi coal-fired power station, the first unit of which will begin ramping up towards the end of 2013. EDM has contracted with the facility to meet its daily peak demand.
Aggreko CE Rupert Soames reports that the plant will be developed near the Mozambique border town of Ressano Garcia, on a site in close proximity to the existing Sasol gas pipeline, which runs from northern Mozambique through to South Africa, as well as a 275 kV transmission corridor.
Besides installing containerised power generation units, which will be shipped in from Dumbarton, in Scotland, Aggreko will also build gas interconnections, a substation, and a 1.5 km 275 kV transmission line to the main network. This infrastructure will remain intact once the installation is dismantled.
Shanduka CE Phuti Mahanyele says that all regulatory approvals have been obtained from the authorities in both countries, includ- ing the National Energy Regulator of South Africa.
However, both Mahanyele and Soames stress that some outstanding conditions remain, which they hope to finalise over the coming weeks.
Aggreko has already invested “tens of millions of dollars” at its own risk to ensure that the project is able to meet its challenging 22-week deployment schedule.
Soames explains that an accelerated deployment is necessary given that Sasol is likely to reallocate the gas to other ventures after July 2014. However, he says that Aggreko is attuned to playing such a “bridging role”, as it has in Kenya, Uganda and Tanzania, as well as in other parts of the world.
Both EDM and Eskom have welcomed the cross-border development.