Tanzania: 400 MW Power Plant Will Serve the Southern Region

Tanzania Electric Supply Company Ltd (Tanesco) and US-based Energy Firm; Symbion Power signed on 13 February 2013 a memorandum of understanding(MoU). The MoU is for the implementation of a 400 MW gas-fired power plant in Mtwara Region, in the south of Tanzania.

The MoU was signed by Tanesco Acting Managing Director; Mr Felchesmi Mramba and Symbion Chief Executive Officer; Mr Paul Hinks. It is a public-private partnership which takes advantage of the recent offshore commercial gas discovery in Tanzania.

The joint-venture project includes a 650 km transmission backbone from Mtwara to Songea. It will be connected to the national power grid through a line that will be built from Makambako to Songea.

Implementation of the project will be phased, according to Mr Mramba, affirming that it will take three years from financial closure to completion.

Symbion and Tanesco will be working with a number of international funding agencies, banks and private equity firms this year in order to put the project’s financial package together. Noting, “many partners have already expressed great interest in the project”. We are hopeful that US government agencies such as the US Exim Bank and the US Overseas Private Investment Corporation will show keen interest in the investment too” affirmed Mr Hinks.

Southern regions in Tanzania have experienced poor power reliability for many years. Connecting southern regions to the national grid will significantly improve reliability of the entire electricity network.

Besides power supply, according to Tanesco and Symbion officials, the project would create jobs and incomes for millions of residents in the area.

Discussions on the project between the two partners started in September 2012 when Symbion presented the proposal to Tanesco and the Ministry of Energy and Minerals.

From the signing of the MoU, it will take around 12 months to put the necessary financing in place before the three-year clock begins to tick, according to Symbion chief executive officer.

After completion of the engineering study and other ground works the total cost of the entire project will be known and publicly announced.