|Essar strikes Munyati power deal|
|Thursday, 17 May 2012 00:00|
Martin Kadzere Business Reporter
Ncube said in an interview yesterday that Cabinet recently approved a Memorandum of Understanding between the power utility and Essar.
Munyati is a coal-fired thermal unit in Kwekwe, about 200km west of Harare. It has an installed capacity of 98 megawatts.
Minister Ncube could not give details about the lease tenure, but sources at the Ministry of Energy and Power Development said Essar had negotiated for 30 years while Zesa wanted to lease it for only 10 years.
“Those were the sticking issues about the deal as the ministry felt that the tenure that Essar wanted was too long and also that allowing Essar to sell excess power to customers of their choice could have resulted in them exporting,” said a source that asked not to be named.
Essar plans to invest US$4 billion in Zimbabwe’s steel industry in the next 10 years, resident director for Africa, the Middle East and Turkey Mr Firdhose Coovadia said in February.
But he said the company will start when mining rights, previously owned by Zisco, are transferred to the new entity.
more than a year after the deal was sealed.