Global crunch stalls Zambia hydro-power project

The global financial crisis has crept into Zambia as a significant power project meant to aid the country’s power deficit will be delayed several months as a result of the slow down in the world economy, said an official from the World Bank.

The 750MW Kufue Gorge Lower hydropower station that was set to begin construction next year, is now delayed, said Saleem Karimjee, International Finance Corporation (IFC) manager for the Southern African region.

Karimjee said that the IFC expects some of the 15 firms interested in investing into the hydropower station to pull out amid the financial crisis. Zambian authorities say the Kafue Gorge Lower project, estimated to cost $1.5 billion to construct, will end power shortages, which have forced the country’s copper mines to cut output this year due to rationing of power by the state power utility Zesco.

“Given the fact that some of these (firms) are international companies that would have more obligations elsewhere that become more pressing given the financial crisis, (we expect that) one or two would drop out, but we still see keen interest from the parties,” he said.

Source: Alternative Energy