ZPC re-powering projects in limbo
INDIAN firm, Jaguar Overseas, is still battling to secure $70 million funding required to rehabilitate Harare Power Station three years after the company won the multi-million dollar tender.
The outdated plant, with the latest generators commissioned in 1942, has been producing power intermittently since being decommissioned in 1970. Re-powering entails replacing old boiler with new technologies that increase the power generated.
Jaguar Overseas initially hoped to secure funding for Harare from State-owned India Eximbank, but its proposal was rejected amid indications that the company was not in good books with the bank.
Jaguar Overseas and its local partner, Intratrek Zimbabwe fronted by businessman Wicknell Chivhayo, landed another multi-million dollar contract for the re-powering of Munyati, which has been dogged by irregularities relating to the way the tender was awarded.
Jaguar Overseas and Intratrek were awarded the rehabilitation tender at an EPC price of $113 million excluding taxes. The alleged irregularities stem from concerns raised by the ZPC accounting officer who expressed reservations about Jaguar Overseas’ ability to fund the re-powering of Munyati when it was struggling to secure funding for Harare.
In a development that casts aspersions on the Indian firm’s suitability to undertake the local re-powering projects, ZPC has already secured funding from India Eximbank, the same institution that spurned Jaguar Overseas’ application.
India Eximbank last year agreed to finance the $87 million re-powering project for another ZPC thermal power plant, in Bulawayo Power Station, to upgrade the station and restore its capacity to 120MW.
Tendering for the EPC contract is already underway in India. After it was spurned by India Eximbank, Jaguar Overseas turned its focus on Afreximbank, but has not been able to secure the requisite funding with ZPC indicating that it was awaiting feedback on whether there was progress. “India Eximbank turned down the request for funding by Jaguar Overseas to re-power Harare Power Station. Jaguar have since pursued other options and we are yet to receive feedback from them,” ZPC said in response to enquiries.
The re-powering of Harare Power Station is part of ZPC, a generation unit of State-owned utility Zesa Holdings. Zesa has a grand plan to raise power production by refurbishing three small thermals to close deficit with output at 1 000MW against peak demand of 1 400MW.
Other bigger projects entail expanding Kariba South by 300MW and 920MW capacity Hwange Power Station, which though currently average 480MW, by a further 600MW through units 7 and 8. “The tender for Munyati re-powering was awarded to Jaguar by the State Procurement Board. A due diligence exercise was later done in 2016 which raised a few issues of concern. We are in the process of resolving them and looking forward to a positive outcome soon.”