HomeRegional NewsEast AfricaTanzanian hydro project may still go ahead

Tanzanian hydro project may still go ahead

1 July 2008 – A Memorandum of Understanding (MOU) was signed recently between Energem Resources Inc and Infrastructural Development Finance (IDF) of Tanzania, in which Energem will acquire 40% interest in a 900MW hydropower scheme in ‘consideration for advancing a short term loan’ of US$1.2 million.

Hydropower3_2:2007In the MOU Energem undertakes to fund and assist in updating the Stieglers Gorge hydro power scheme engineering and feasibility studies, bring these to bankable feasibility status and assist in raising funding for the project.

Historically, a feasibility study was undertaken in the 1980’s through Norwegian government funding – this study will be updated. Originally, the project was shelved due to a lack of regional electricity demand vs project costs. IDF has been granted project rights by the Tanzanian government to update the study and potentially develop and construct the scheme, which will be located on the Rufiji river.

Jeffares and Green have been appointed by Energem to examine the original feasibility study and it has already been established that minimal updating will be required to bring the studies up to internationally acceptable bankable levels.

The original feasibility study showed that a dam at the site would have "limited environmental impact, is expected to use only a minor fraction of the area of the Selous Game Reserve, requires no resettlement of local communities and can provide substantial down stream irrigation and flood control benefit to agricultural development in the area," a press release from Energem said.

Capital outlay for the project is estimated at US$2 billion and it is estimated the project will take five years to complete.