A southern African bank will provide a $60 million loan to Zambia, and China will give a further $420 million loan to fund a power project meant to plug a power deficit, state-run power utility Zesco said on Monday.
Zesco acting managing director Cyprian Chitundu said China’s Exim Bank will release the $420 million after Zambia obtains $60 million for the Kariba North Bank hydro power expansion project from the Development Bank of Southern Africa (DBSA).
The Kariba North Bank plant generates 720 MW, mainly feeding copper and cobalt mines, and will be expanded by 360 MW by 2012 when the projected is completed.
Zambia, Africa’s largest copper producer, is upgrading its power generation capacity to meet rising demand and help to boost supply in the region.
“DBSA has agreed to (provide) the…$60 million (partial financing), but we have not reached financial closure. We are almost at the point of closing the deal,” Chitundu told Reuters.
Chitundu said Zesco, which engaged China’s Sinohydro last year to start the Kariba North bank expansion project had already spent $18 million on the project, where a fire damaged the plant and killed two workers a fortnight ago.
Chitundu said Zesco will also seek a total of $220 million from the Africa Development Bank (AfDB) and European Investment Bank (EIB) to develop the Ithezi-Tezhi power project, where 120 MW will be generated.
Zambia generates 1,400 MW of electricity and consumes about 800 MW during the day, but demand rises to 1,500 MW at peak during the night.
Reuters.