HomeIndustry SectorsFinance and PolicyZesco and Sino Hydro sign US$243 million agreement

Zesco and Sino Hydro sign US$243 million agreement

23 November 2007 – An agreement worth US$243 million has been signed between Zesco Limited and Sino Hydro of China to increase capacity at the Kariba North Bank power station by 360MW.

Zesco is currently operating at around 1 300MW, while peak demand is averaging 1 450MW. While Zesco has an installed capacity of some 1 640MW, rehabilitation works and maintenance have resulted in some of this capacity being taken off line.

According to Rhodnie Sisala, Zesco managing director, 85% of the funding has been provided by the Export and Import Bank of China, and the balance of the funds will be sourced from other financial institutions.

“We will be signing loan agreements with the Export and Import Bank of China by the end of December and implementation of the project will commence immediately thereafter.

“It will be a 360 megawatt capacity plant, underground adjacent to the existing machinery. This will increase the capacity of Kariba North Bank to 1,080 megawatts,” he said.

Working with a consortium of advisers, including Fieldstone, the Development Bank of Southern Africa and Le Boeuf Lamb & Mc Rae, Zesco is hoping to negotiate the remaining 15% financing.

The upgrade project will be located at the existing Kariba North Bank location on the Zambezi river at Kariba dam.

The extension is expected to be on line by December 2011 with the installation of the last two 180MW generators.

Song Dongsheng, deputy managing director of Sino Hydro is confident the company can complete the project within four years.