The Mozambican government has approved a 25 year concession contract for the construction of a coal-fired power station of up to 600 MW at Moatize in Tete province. The power plant will be constructed and managed by ACWA Power Moatize Termoelectrica (APMT), a consortium that includes Vale, Mitsui and ACWA Power of Saudi Arabia. The first phase of the project will involve the construction of a 300 MW plant for US$1billion.

In addition to ACWA Power, lead developer, investor and operator of the project, Vale, one of the largest mining companies in the world, and Mitsui, a global Japanese trading house, as cosponsors of the project, the Mozambican state owned utility, Electricity de Mozambique (EDM), and local investor Whatana Investment Group will enter as minority shareholders.

The Moatize independent power producer (IPP) will be developed on a build own operate and transfer (BOOT) basis, and will be a pulverised fuel, subcritical coal fired power station. About 250 MW of the total capacity of 300 MW will feed the largest coal mine in the world that Vale is developing at this site with the remaining 50 MW supplied to EDM, to feed the grid.

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

“Signature on this concession agreement is a significant milestone for the Moatize IPP enabling us to complete the financing process and commence full scale construction.

The 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 help to diversify ACWA Power’s fuel experience beyond oil, gas and solar to now coal,” Paddy Padmanathan, president and CEO of ACWA Power says.

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