Business
China’s influence in Africa: Tanzania 300 MW power plant
(Reuters) – Tanzania has secured a loan from China to build a US$684 million gas-fired power plant in the south of the country to plug energy shortages in east Africa’s second biggest economy, the government said late on Wednesday.
The 300-megawatt (MW) power plant will be built at Mnazi Bay by China National Machinery Equipment Import & Export Corporation (CMEC) and German engineering group Siemens, the government said.
“The major power project, will be financed by a loan from the Exim (Export-Import) Bank of China and the Tanzanian government,” the president’s office said in a statement.
It said the project would also involve construction of a 1,100-kilometre power transmission line from Mtwara in southern Tanzania to Singida region in the centre of the country, but did not specify when construction would start.
The former permanent secretary of Tanzania’s energy ministry, David Jairo, told Reuters in June the project would be implemented in the 2011/12 financial year, which runs until June 30, 2012.
Officials from the Chinese and German companies briefed Tanzanian President Jakaya Kikwete at State House in Dar es Salaam on Wednesday on preparations for the project.
“Electricity to be generated from the project will be hooked to the national power grid. Six regions that were not in the power grid will be connected thanks to this project,” said the statement.
China has emerged as the main source of funding for major infrastructure projects in Tanzania, including construction of a US$1 billion natural gas pipeline. New discoveries have boosted Tanzania’s natural gas reserves to more than 10 trillion cubic feet (tcf) from a previous estimate of 7.5 tcf.
A Chinese firm, Sichuan Hongda Co. Ltd., last month signed a $3 billion deal with Tanzania to mine coal and iron ore in the resource-rich country.
Tanzania’s state-run power utility, TANESCO, said it plans to spend 1.2 trillion shillings by the end of next year on emergency power projects.
Tanzania has been plagued by rolling blackouts for the past year, prompting the International Monetary Fund to revise its 2011 growth forecast for the country downwards to 6 percent from 7.2 percent previously.