By Engel Nawatiseb TSUMEB NAMPOWER'S Managing Director Dr Leake Hangala says his company has successfully navigated three distinct transitions since its assumption of a new identity in post-independent Namibia. Amongst them are institutional reorientation to reflect and support the developmental, economic and other agendas of democracy, including the upgrading of infrastructure. The company has restructured its operations to meet future challenges including a more domestic and regional energy market. He said that NamPower's transmission system has coped well with the record demands placed on it notwithstanding a full drawdown of power at the Skorpion mine and smelter project in the country. He added that the country did not experience optimal rainfall patterns, although a better Kunene flow was recorded during the dry season resulting in water flowing through the country's flagship plant at Ruacana, hence securing a degree of independence from foreign suppliers. "NamPower is now fully in a position to contribute effectively from a new posture in that downstream distribution sector. Cost containment measures continued to bear fruit, particularly in rationalization of capital spending as the group moved to further strengthen its balance sheet in anticipation of the Kudu Gas to Power Project and other expansions in capacity planned over the coming years," he stated. The Southern African Power Pool (SSPP) faces challenges of diminishing surplus in generation capacity coupled with new congestion points appearing within utilities as transmission transfer limits are reached. In the last 10 years, the growth in power demand in the SADC region has outstripped investment in power generation. The demand has increased at a rate of roughly three-percent per year, driven by demographics, natural growth and in some countries non-economic tariffs that encouraged consumption at the expense of investment. Hangala said that the continued decrease in surplus capacity impacts negatively on prospects for economic growth and inward investment. NamPower also maintained its long tradition of support for rural electrification with over N$60 million being expended on the commissioning of some 1 600 kilometres worth of distribution lines across the country. This includes the electrification of Tallismanus, Witkop, Omammas, Usib and Kanubeb as well as the commencement of construction at UB, Bloukrans and Hatsamas. The Energy Trading and New Works section commissioned transmission facilities to the value of N$52 million this year. Amongst such projects featured the extension of the Omaere, Kutako, Rossmund, and Otjikoto substations as well as the upgrading and protection and refurbishment of the 66 kilovolt busbar at the Van Eck power station. He said the group financial performance also reflects greater strength, which at N$64 million in net profit closely tracked the preceding year's N$67 million. More indicative of the group's overall financial health is its gross revenue position, which surged over the 10-figure mark to a record N$1,01 billion. This represents an extraordinary strong platform upon which to build the future. A dividend of N$5 million was recommended to the Government this year. The company's net cash generated from operations increased by 52-percent and contributed to the attainment of record balances in the company's investment portfolio (N$1,5 billion) and total cash and investments amounting to N$1,5 billion. The reserves are earmarked to contribute to the financing of the Kudu Gas project and the Caprivi link. Hangala noted that the company's assets grew marginally by three-percent while the property, plant and equipment decreased by 17-percent due to depreciation as well as reduced levels of capital expenditure after the record outlays of recent years. Hangala made the observations in his annual report about the activities of the bulk electricity supply company.
New Era Reporter
2005-12-23 00:00:00 13 years ago