Maravi

Sisala dismisses fears of investment loss in mining

Sisala dismisses fears of investment loss in mining
By Jack Zimba
Monday April 21, 2008 [04:00]

ZESCO managing director Rodnie Sisala has dismissed fears that Zambia is losing huge investments in the mining sector due to the power deficit the country and the sub-region is currently facing. “We are in regular discussion with investors in that sector and speaking to them. We do not get that impression that people are pulling back in terms of investing in the mining sector,” Sisala told the parliamentary committee on energy last Friday.

Sisala assured the committee, chaired by Mazabuka Central member of parliament Gary Nkombo, that with the many mines and factories scheduled to begin operations in the next one year, the power utility company had made its projections into the country’s power needs and plans were under way to meet the demand.

He said the country’s power consumption was expected to increase in the next five years, from the current 1,400 mega watts to 2,500 megawatts.

“Part of our challenge now is how we are going to get that additional 1,000 megawatts and we do have plans to meet that expected demand in power,” Sisala said.

Asked if Zesco would seek a foreign investor to develop the Kafue Gorge Lower, Sisala said with an asset base of US$4 billion, Zesco was in a good position to source the US$1 billion needed for the project.

He said there was no need for partnership with a foreign investor to develop the project.

And Sisala said Zesco would continue with the rural electrification programme despite the power deficit the country was facing.

Sisala said the power required to supply rural needs was small and could not have a significant effect on the national power output.

Last year, the southern African region experienced power blackouts, forcing South Africa and Zambia to cut supply to neighbouring countries such as Zimbabwe and Mozambique.

But Zesco’s director of generation and transmission, Christopher Nthala, said Zambia would soon get back on the regional inter-connector.

He Zambia could not stand alone in the region, adding that the advantages of being inter-connected by far outweighed the disadvantages.

“We are just waiting for things to be sorted out in one of our neighbouring countries which I will not name,” Nthala said.

Sisala also expressed concern at Zambia’s ‘low tariffs,’ saying this would in future make the country less competitive in the region.

“In future we might face a situation where an investor from another country in the region will import power from us cheaply and sell it back to us at a higher price,” he said.

Sisala insisted that Zambia had the lowest tariffs in the region at four cents per kW, compared to other countries where it cost as much as seven cents per Kw.

Labels: RHODNIE SISALA, ZESCO

posted by MrK @ 10:10 PM