Shares in Scottish temporary power company Aggreko have jumped after it revealed a $200 million contract to provide electricity to two African countries.
The firm, which has provided power solution to major global events such as the Olympics and World Cup, has signed tri-party power purchase agreements with the Mozambique utility Electricidade de Moambique (EDM) and NamPower of Namibia.
Under the agreement Aggreko will provide 122MW of gas-fuelled power from an interim power plant located at Gigawatt Park at Ressano Garcia in Mozambique.
Once installed, the power generated will be split between the two utility companies, with EDM taking up to 32MW and NamPower up to 90MW.
Glasgow headquartered Aggreko built the facility at Ressano Garcia last year as part of an ambitious project in which it became the first cross-border interim independent electricity provider to the Southern African Power Pool (SAPP), one of the world’s largest interconnected grids, with links to the power networks in nine African countries.
Under the first phase of the project, which commenced generation last July, Aggreko and its joint-venture partner Shanduka are already providing 110MW of power to EDM in Mozambique and South African utility ESKOM.
The success of the initial phase of the Ressano Garcia project has led Aggreko to widen the scope of the development and offer additional resources to other members of SAPP.
By utilising the regional transmission infrastructure Aggreko is able to supply power generated in Mozambique to Namibia, more than 1,500km away.
The new 122MW plant is scheduled to go into production in the second quarter of this year and, under the new agreement, will supply power for a minimum of two years.
Natural gas to the project is being supplied by the Matola Gas Company through their local gas infrastructure, and Aggreko will generate the power under a sub-concession agreement with Gigawatt Mozambique SA.
The total value of the project is likely to be in excess of $200 million, including fuel costs.
Aggreko chief executive Rupert Soames said there was huge potential for temporary power generation in the region.
“This new project will make Ressano Garcia the world’s largest cross-border interim power plant, with over 232MW of gas-fuelled power generation,” he said.
“It underlines the immense potential of SAPP to be a real conduit of cooperation and development among the countries of southern Africa.
“The fact that three national utilities are collaborating to support each other’s energy requirements is testament to the benefit of working together for the common good.”
NamPower managing director Paulinus Shilamba said: “This unique project will contribute to the provision of a reliable power supply across Namibia and support the continued development of the country.”
EDM chief executive Augusto Sousa Fernando said: “We would once again like to welcome the second phase of the Aggreko interim power plant at Ressano Garcia, which will assist EDM and its partners in the SAPP to bridge the period until we implement our permanent plants in Mozambique.”
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