2006-12-08Staff Report 2 "By Petronella Sibeene WINDHOEK The Kudu Gas power project, regarded as one of the possible solutions that could alleviate the projected electricity deficit, is expected to start in 2007 should the current negotiations between relevant parties conclude favourably. On Wednesday the Managing Director of NamPower, Paulinus Shilamba, revealed that the power utility is engaged in extensive negotiations with gas supplier company Tullow Oil. Negotiations have dragged to date considering that Tullow Oil insists that NamPower purchases the gas in US dollars. This proposal would not favour the local power supplier as it sells its commodity in Namibian dollars. Other dominant areas of negotiations among other technical ones include the price at which this gas could be sold. The two parties held talks two days ago in Johannesburg, South Africa. ""Price and currency are the dominant issues to be discussed at the moment,"" he said. Should the two parties fail to reach an agreement, Shilamba said, other means would be sought. Whether this agreement is fruitful or not, he gave the assurance the Kudu project has to be completed by 2010. The 800 MW Kudu Power Station near Oranjemund, southwest of the country, will be implemented at a total cost of approximately N$5 billion. The development of the Kudu Gas scheme comes at a time when the SADC region faces a steady decline in a power surplus as demand fast exceeds the available generation capacity. This situation is expected to reach a critical phase by 2007. Demand is currently growing at an average of 3% per year. While the imminent power shortage is expected to affect Namibia largely due to its dependency on other countries, especially South Africa, NamPower has made progress in developing the existing power generators within the borders of Namibia and beyond. According to Shilamba, NamPower is in the process of implementing the Caprivi Link Inter-connector, which will comprise of the AC network strengthening a 970-kilometre, 350 kilovolt (kV) High Voltage Direct Current (HVDC) bipolar line and converter stations. Under this initiative, a 220 kV AC line from Livingstone in Zambia to the Zambezi substation in Katima Mulilo was commissioned in September this year. ""We are working hard to implement the new HVDC converter stations at Zambezi substation near Katima Mulilo ands Gerus substation between Otjiwarongo and Outjo,"" Shilamba said. Another 285-kilometre 400 kV AC transmission line will be extended from Auas substation to Gerus and associated substations. ""The 970 kilometre bipolar line with one pole of the converter stations at Zambezi and Gerus substations is to be implemented starting in the first quarter of 2007 to mid -2009. The 285 km 400 kV AC substation line and associated substations extensions at Auas and Gerus substations and the completion of the second pole of the converter stations will be completed by June 2010,"" Shilamba added. The Kudu power station together with the Caprivi link will cost about N$8.7 billion over the next five years. Beyond the borders, NamPower is involved in consultations with Zimbabwe and Botswana to extend the Caprivi inter-connector. This interconnection will serve as a conduit for electricity, complementing Namibia's current inter-connectivity with South Africa. Further negotiations regarding the Baynes Hydropower Scheme have already started between Namibia and Angola. ""The project is being negotiated by the governments of Angola and Namibia through meetings of the Permanent Joint Technical Commission on the Kunene River Basin (PJTC). NamPower is hopeful that this project will soon be realized,"" the managing director said. The bilateral agreement between NamPower and Escom expired in 2006 but NamPower negotiated a new 15-year extension that came into force on 1 July 2006. During the first half of 2006, Namibia faced a power supply problem due to the situation at Koeberg power station in South Africa. This, Shilamba said, resulted in a loss of supply. Total demand was then 375 megawatts. NamPower's local general capacity output stood at 316 megawatts while import from South Africa was 88 megawatts. Due to problems, Escom could only supply Namibia with 58 megawatts leaving the country with about 30 megawatts short. Shilamba said that the situation has since normalized. The power supply situation in Namibia and the Southern African region can only be improved if countries invest in generation facilities, he said." 2006-12-08Staff Report 2
