Monday, March 19, 2007

Mozambique, China in Talks on Hydro-Power Project

Mozambique, China in talks on hydro-power project

Mon Mar 19, 2007 3:51 PM GMT
By Charles Mangwiro

MAPUTO (Reuters) - Mozambique is close to a deal
with China that would pave the way for a $300
million hydro-electric dam in Maputo, Public
Works and Housing Minister Felicio Zacarias said
on Monday.

China's Export-Import Bank (Eximbank) already
has agreed to finance studies for the Moamba
Major project, which would expand the supply of
electricity as well as drinking water in the
Mozambiquan capital, Zararias said.

The talks could see the Chinese taking a much
larger stake in the project, according to
Zacarias, who did not provide further details.

"We are about to close the discussions and hope
China will fund and construct the dam," Zacarias
told Reuters in an interview. He added that the
project could help control flooding and droughts
in the impoverished southern African nation.

Dozens of people were killed and some 170,000
forced to flee their homes in central Mozambique
in February when heavy rains triggered flash
flooding along the Zambezi river and its

Mozambique officials said last year that
Eximbank planned to invest some $2.3 billion in
the construction of the new Mepanda Nkua dam and
1,300 Megawatt hydro-electric plant on the
Zambezi River, south of the giant Cahora Bassa
power development.

At the time officials said discussions were also
under way with China on the Moamba Major project.

Although Mozambique has large supplies of fresh
water, much of the infrastructure required to
transport it to Maputo and other cities was
destroyed or allowed to fall into disrepair
during a two-decade civil war that ended in the
early 1990s.

Zacarias said the government planned to expand
the number of medium-sized and large dams in the
country -- there are currently 12 -- in order to
meet its goal of extending clean drinking water
to 60 percent of the population by 2015.

Only about 40 percent of Mozambiquans have access to clean water.

The Moamba Major project would also allow
Mozambique, which currently relies on Cahora
Bassa in northern Tete province, to meet growing
domestic and regional power demands.

Cahora Bassa generates some 2,075 megawatts of
power, providing Mozambique with $100 million in
annual electricity exports. There are plans to
expand the site to add a further 850 megawatts of

South Africa, the economic powerhouse in the
region as well as the African continent, is
expected to absorb the bulk of the additional
electricity produced in neighbouring Mozambique.

(Editing by William Hardy; Johannesburg bureau 27 11 .

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