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Mozambique to construct 600MW coal-fired power station in Tete province

The first phase of the coal-fired power station will power a coal mine being developed by Vale MZ. (Image source: Alan Stark/Flickr)

The Mozambican government has approved a 25-year concession contract for the construction of a 600MW coal-fired independent power producer (IPP) in Moatize, Tete province

A consortium led by ACWA Power Moatize Termoelectrica (APMT), comprising Vale, Mitsui and ACWA Power of Saudi Arabia, will manage the plant.

The state-owned utility Electricity de Mozambique (EDM) and local investor Whatana Investment Group will be minority shareholders in the project, industry sources said.

Moatize IPP will reportedly be developed on a build own operate and transfer (BOOT) basis, and is expected to be a pulverised fuel, sub-critical coal-fired power station.

The first phase of the project will involve the construction of a 300MW plant for US$1bn. Of this capacity, 250MW will feed the coal mine being developed by Vale MZ, while the remaining 50MW will be utilised by EDM to feed the grid, according to ACWA Power.

Paddy Padmanathan, president and CEO of ACWA Power, said, “The Moatize IPP will significantly enhance ACWA Power’s position as a rapidly expanding power developer in the southern cone of Africa, one of our target markets, and also help to diversify ACWA Power’s fuel experience beyond oil, gas and solar to now coal.”

The sponsors have selected international contractor GS Engineering & Construction from South Korea for the engineering, procurement and construction (EPC) of the project, and ACWA Power’s wholly-owned subsidiary NOMAC will be responsible for the operation and maintenance of the plant.

The project is expected to be the first large-scale greenfield power project in the country to be financed using the project finance framework.

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