Erongo power project not in conflict with Kudu
The development of a 250MW long-term generation facility at the coast in the Erongo Region to alleviate the country’s power woes will not be competing with or affect the development of the Kudu project, as revealed this week.
NamPower’s Managing Director, Paulinus Shilamba said, “Contrary to media reports last week that the project is competing against Kudu and will make Kudu redundant, we totally disagree and would like to take this opportunity to emphasise that this report is misleading and factually incorrect.”
“The truth is that after 2018 this power station will complement Kudu by serving some peaks especially during dry seasons, and to operate when one or both of the Kudu 450MW blocks are out of service for planned or unplanned maintenance” he said.
He added that the plant will therefore enable Nampower to continue serving its customers even if one block from Kudu is not available.
The proposed Erongo plant is expected to cost approximately N$3 billion and to be operational by mid 2016. The idea for its development came about after realising that the previously proposed emergency diesel generators would prove to be a burden on the national economy hence the option to divert the project to the development of a proper power facility.
The plant which Shilamba said is to be procured through a transparent bidding process will operate in base-load mode until 2017 and in mid merit/peaking or stand-by mode after 2018.
Asked how the project will be funded, Shilamba stated that a Special Purpose Vehicle (SPV) in which NamPower will hold 30% equity (N$300 million) will be created to develop the project tapping into the private sector. The Special Purpose Vehicle will also enable borrowing of funds from investors in the capital market.
Shilamba said NamPower has issued an Expression of Interest (EOI) to solicit interest from the market, to be followed by a pre-qualification process and finally a request for proposals (RFP). He said the final investment decision on the project is expected by December this year.
Meanwhile the evaluation of the four tenders of the Kudu Project that were issued in 2013 are in the final stages and the results are expected to be presented to the NamPower governance structures for approval during the course of April and May this year.
“The Board of Directors, accompanied by the Kudu Project team members, have undertaken a trip to Europe (Spain), the Middle East (Qatar), China and South Korea from 7 to 18 April 2014 as part of the Engineering, Procurement and Construction tender requirements of visiting one power station per bidding consortium” Shilamba stated.
He emphasised that the trips to these different power stations bear no relation to the visit that was made to Brazil in March by a different NamPower project team working on the 250MW Erongo project.