DRC hy­dropower gets a R3.95 bn elec­tri­cal surge

Glen­core, Congo part­ner re­fur­bish main plant

The Star Early Edition - - FOCUS ON AFRICA - Aaron Ross

GLEN­CORE and its part­ner in Congo are plough­ing $360 mil­lion (R3.95 bn) into re­fur­bish­ing the African na­tion’s main hy­dro­elec­tric plant as min­ing com­pa­nies seek ways to over­come power short­ages that are hold­ing back projects.

Min­ing in­vest­ment has poured into the Demo­cratic Repub­lic of Congo since 2006, after the 1998-2003 war ended and an elec­tion drew a line un­der decades of dic­ta­tor­ship. Last year, Congo beat out Zam­bia to be­come Africa’s main cop­per pro­ducer with out­put of 914 631 tons.

But com­pa­nies seek­ing to tap some of the world’s big­gest un­de­vel­oped min­eral re­serves say power short­ages are pre­vent­ing de­vel­op­ment.

Prime Min­is­ter Au­gustin Matata Ponyo told com­pa­nies in Jan­uary to halt any ex­pan­sion plans that re­quired ex­tra power in the south-east­ern min­ing heart­land of Katanga prov­ince.

“If you want to (pro­duce) 1.5m tons of cop­per, this is only pos­si­ble if you solve the en­ergy prob­lem,” said Pi­eter De­boutte, who sits on the board of Mu­tanda Min­ing, a cop­per project owned by Glen­core and the Fleurette Group, which is con­trolled by Is­raeli bil­lion­aire Dan Gertler.

With de­mand for gen­er­a­tion ca­pac­ity of 912 to 1 202 megawatts, Katanga is fac­ing a deficit of up to 734MW, ac­cord­ing to an Au­gust re­port from na­tional util­ity company SNEL.

Mu­tanda’s Kamoto mine in Katanga suf­fered more than 862 hours of power in­ter­rup­tions be­tween May and Septem­ber, ac­cord­ing to company fig- ures. Un­til now Mu­tanda has re­sorted to im­port­ing en­ergy from Zam­bia at up to twice the price of do­mes­tic power and us­ing diesel gen­er­a­tors that cost $3m a month.

Glen­core and Fleurette have now de­cided to take mat­ters into their own hands by re­pair­ing two tur­bines at SNEL’s 1 424MW Inga 2 hy­dropower plant and up­grad­ing about 2 000km of trans­mis­sion lines to take the power to Katanga.

The plan is to pro­duce 450MW, with 380MW re­served for Kamoto. Mu­tanda will re­coup the cost through re­duc­tions in util­ity bills, De­boutte said. “The model here is you bring what you need,” said Os­car Mel­hado, the In­ter­na­tional Mon­e­tary Fund’s rep­re­sen­ta­tive in Congo.

Rand­gold Re­sources, which poured the first gold at its Kibali mine in Congo’s re­mote north-east last year, opted for this do-it-your­self strat­egy from the start. “We just got on and built our own hy­dropower sta­tions,” said Mark Bris­tow, chief ex­ec­u­tive of Rand­gold, which runs the mine in a joint ven­ture with AngloGold Ashanti and state miner Sokimo.

Congo’s hy­dro­elec­tric-po­ten­tial ranks third be­hind China’s and Rus­sia’s, ac­cord­ing to the World Bank, but mis­man­age­ment has left 90 per­cent of its roughly 65 mil­lion peo­ple with­out elec­tric­ity.

For the long term, the gov­ern­ment is count­ing on a new Inga 3 hy­dro­elec­tric project with 4 800MW of ca­pac­ity. Con­struc­tion of the dam is set to be­gin next year and be com­pleted in 2020, ac­cord­ing to SNEL.

Some 1 300MW will be re­served for the min­ing sec­tor and another 2 500 MW will be sold to South Africa. The re­main­ing 1 000MW will go to do­mes­tic con­sump­tion. – Reuters

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