Earlier this week, Ncondezi Energy Company announced that it has signed a binding Joint Development Agreement with China's Shanghai Electric Power Company. The agreement sets out the terms on which a 300MW coal-fired power project in Mozambique's Tete province will be developed.
The project is located approximately 85km from the existing power transmission grid. The London stock exchange listed company, Ncondezi Energy explained that it is targeting to commission power generated from the plant in the second half of 2017 and commercial operations in the first half of 2018.
Ncondezi maintains ownership
In a company statement, Ncondezi Energy stated that under the agreement Shanghai Electric Power Company will "become the strategic investor".
The Chinese electric power company is expected to invest up to $25.5 million for the development of the project and in return will obtain a 60% share.
The statement further explained that: “the Ncondezi coal mine will continue to be wholly owned by Ncondezi and will be developed and financed separately", adding that a possible coal supply agreement could be signed with relevant entities.
120MW gas-fired power station
In other power generation news, Mozambique News Agency reported that the energy company Gigawatt Mozambique has declared the completion of a 120MW gas-fired power station in Ressano Garcia, located on the border with South Africa.
The electricity generated by the $200 million gas-fired power station is expected to be sold to the country’s public utility, EDM, under an agreement with Gigawatt.
According to local media, the power generated can also be sold to the regional network of the Southern African Power Pool (SAPP).